The extent of globalization has surmounted to a degree where economic policies of each and every country are interdependent. This is precisely because of the fact that economic policies in one country have a corresponding impact on the country with which it shares significant trade relationships (Haskel, Pereira and Slaughter, 2007). It is with regards to the facts that have been mentioned above, the researcher believes the statement, National boundaries have been surmounted by the phenomenon of ‘globalization’ and therefore, national governments are no longer able to promote independent economic policies to be absolutely justified. In this study, the researcher will conduct extensive qualitative research on works of literature that have been published surrounding the topic. By doing so, the researcher will be endeavouring to collect conclusive pieces of evidence justifying the credibility of the proposition stated above.Financial integration is considered to be a by-product of globalization by several researchers. The business activities that are conducted in the financial service sector have become heavily globalized. A noteworthy relevance can be found in the banking and insurance industries where each and every business activities have transcended every international boundary. For instance, banks all over the world are heavily engaged in transactions which increase their exposure to various foreign exchanges (Naor, Linderman and Schroeder, 2010). Therefore, any unanticipated fluctuations in the foreign exchange rate could have an adverse impact on a particular bank due to its exposure to that currency (Hopkins, 2011). That is why national governments have to be very careful while drafting monetary policies as the fluctuation of foreign exchange depend a lot on the monetary policies made by the government (Saggi, 2002). Such fluctuations may not only impact the financial performance of the local firm but may also hamper the business relations between domestic and foreign-owned companies.