Financial services are the activities and industries that help people manage their money. They include everything from direct saving and lending to investing, insurance and the redistribution of risk. The industry includes a vast range of jobs that touch every aspect of the economy, from accountants and tax filing services to global payment providers like Visa and MasterCard. It also encompasses credit card companies and debt resolution services, as well as the stock and commodity exchanges that facilitate share, bond and derivative trades.
The majority of jobs in this sector are depository institutions, which are the foundation of the financial services group. These companies accept deposits from savers and lend them to borrowers, earning interest in the process. They also provide credit and financing services, which is everything from helping people buy a home to supplying the capital that entrepreneurs need to launch their businesses.
Investment banks are a subset of financial services that specialize in offering investment products to individuals and corporations. They advise clients on their financial options and offer brokerage services to help them buy and sell securities. They are also involved in mergers and acquisitions, and provide underwriting services to help companies go public.
Banking services are another large part of the financial services sector, and involve holding deposits and extending credit. They are the intermediaries between savers and borrowers, providing safe places to store funds and allowing people to access their money easily by writing checks or using electronic transfer systems. Banks earn their revenue through fees, commissions and the spread between interest rates charged on loans versus those paid on deposits.
Insurance is a financial good and a service at the same time. It offers peace of mind by ensuring that you are covered in the event of an accident or catastrophe, such as a house fire, a car crash or an illness. It can even cover loss of income or property that would otherwise be devastating. As such, it is an essential component of most people’s lives, and is therefore one of the most widely used forms of financial services.
Other types of financial services include debt resolution, private equity and venture capital, as well as reinsurance companies. Private equity and venture capital providers supply funding to new or established businesses in return for ownership stakes and profit participation. Reinsurance companies, on the other hand, pool risk from multiple insurers to reduce their exposure to catastrophic losses.
A career in the financial services sector can be very rewarding. It can provide job security and higher pay than many other careers, and it is easy to move up the ladder with hard work and the right connections. Because it is a large industry, there are plenty of opportunities to find the best fit for your skills and interests. At Phyton Talent Advisors, we work with financial services professionals every day, and see firsthand how great this type of career can be. If you are interested in pursuing a position in this area, connect with us today to get started on your search for a new job!