Financial services are the products and services that enable people to manage their money, invest in a business or property, protect themselves against risk, and meet their day-to-day financial needs. They include the activities of banks, credit-card companies, insurance firms, investment houses and private equity groups. A healthy financial services sector is vital to a country’s economy because it helps businesses expand and hire workers, generating more production and creating economic growth. It also provides millions of people with high-paying jobs and allows them to secure mortgages, loans and savings for retirement or other goals.
The industry is a complex network of professionals and institutions that offer advice, capital, investment management, insurance, and other related services to individuals and businesses. This includes banks, credit unions, credit-card companies, credit-card processing networks, investment advisors, brokerage firms, and asset management companies.
GlobalEDGE defines the financial services industry as all work related to money and assets that a company or individual needs in order to function. This includes banking, payment systems, wealth management, and retirement planning. It also includes the research and analysis of securities like stocks, bonds, and derivatives, as well as other market-based investments like real estate and private equity.
As the world’s economic landscape continues to change, the financial services industry is constantly adapting to meet new demands from customers. This means that some products and services may disappear while others are being introduced. Companies need to be nimble enough to respond quickly to changing consumer needs, as well as regulatory changes. For example, exchange-traded funds (ETFs) have become an increasingly popular way for investors to gain exposure to the financial services sector.
A good environment for the financial services industry involves moderately rising interest rates, which allow companies to earn more on the money they have and the debt they issue. It also helps if there is a balance between regulation that ensures consumers’ money and rights are protected, and rules that don’t stifle innovation in the sector.
The industry is a lifecycle-based one, so it’s important for financial services companies to understand their customers and what they need at different stages of their lives. Banks, for example, use data to predict when a customer is likely to make a major purchase like a home or car, so they can be ready with a loan offer.
The scope of the financial services industry is broad, so determining what role you might want to play can be challenging. But there are some key roles that most individuals will need to take on at some point in their lives, so it’s important to consider these options when deciding on your career path. Here are four of the most important positions you’ll need to know about when starting a career in the financial services sector: