Double co-incidence of wants is the most difficult problem of barter system. Double co-incidence means that goods in possession of two different persons must be useful for each other and needed by each other. If wants do not match exactly between the two, no exchange will take place. Money solves the problem of co-incidence. It acts as an intermediate in the exchange process.
Example: Amit has a spare pair of shoes and wants to buy some wheat and sell shoes. So, it is very difficult for Amit to find such a person who wants his shoes and agrees to solve his problem. Only money is accepted as a medium of exchange, commonly. Now, Amit sells the spare pair of shoes in the market and get money. After that, he can buy wheat with this money. So, money has solved the problem of double co-incidence of wants.
Money, by providing the crucial intermediate step, eliminates the need for double co-incidence of wants. It is no longer necessary for the shoe-maker to look for a farmer who will buy his shoes, and at the same time, sell him wheat. All he has to do, is to find a buyer for his shoes. Once he has exchanged his shoes for money, he can purchase wheat or any other commodity, from the market.
