Financial services are the companies that help people manage, invest, and trade money. They include banks, credit-card companies, insurance providers, and the critical infrastructure that supports them all. Thousands of for-profit companies make up the sector, but many community organizations, too. A degree in finance is a good way to get into this field, but it’s not always necessary, and you can also work in financial services without one.
The financial services industry provides the backbone for the economy’s ability to function. These companies help put money to work, whether it’s individuals saving in the bank for a rainy day or businesses investing in the next great technology. Governments regulate the sector to protect borrowers and lenders, foster trust between consumers and providers, and ensure that people’s money is being handled responsibly.
As the world becomes more interconnected, it’s important that everyone understands basic money management, including how to save, invest, and borrow. The sector can help make this possible by promoting financial wellness and empowering customers to choose the right products for their needs. The industry can also drive innovation by breaking down barriers to new products and new ways of working.
In order for a company to qualify as a financial service, it must be involved in the making, investment and/or management of money (whether that’s personal or business). It should also provide a wide range of consumer and commercial banking, insurance and capital markets services. There are a number of big names in the sector, such as Berkshire Hathaway, which owns insurers GEICO, National Indemnity and General Re; Wells Fargo, which is among the biggest banks in the U.S; and Charles Schwab, which was a leader in discount brokerage firms that empowered individual investors.
A financial good is like any other object, but it has some unique characteristics: it must be durable and last for a long time, and it’s also something that can be traded or sold. Financial services can help secure a financial good for you, either by providing a loan or by helping you find a buyer. Examples of financial goods include mortgages, automobile loans and life insurance policies.
The term “financial services” is often used to refer to the entire industry, but it’s important to keep in mind that not all of these companies are banks. In fact, there are numerous other types of companies that fall into this category, including credit card issuers and networks (Visa and Mastercard), global payment systems, debt resolution services, and equity and derivatives exchanges. In addition, there are numerous ancillary companies that support the financial services sector, such as notary services and credit bureaus. These ancillary companies often specialize in niche market sectors or cater to specific demographic groups. For example, some notary services provide services to the legal profession, while others are more focused on local communities. These services enable a broader range of consumers to use the financial system, and they can also play a key role in encouraging savings.