Financial services is a broad category that covers all of the different offerings within the finance industry. It includes everything from insurance and money management to payments and digital banking technology. There are a large number of stakeholders and moving parts within this sector, from credit card issuers and processors to legacy banks and emerging challengers.
Types of financial services
The most common types of financial services include payment system providers, banking and lending institutions, and investment banks. In addition, there are many specialized types of financial services as well.
Banks – The primary function of banks is to accept deposits, pool them together, and then loan those funds out to individuals who need them. This process helps individuals build their savings and also allows them to borrow when they need it most.
Investment banks – Unlike traditional banks, investment banks focus on helping businesses raise money. These firms offer services such as mergers and acquisitions, underwriting debt and equity, restructuring, and investment management.
Conglomerates – These are companies that operate in multiple sectors of the financial services market, including life insurance, general insurance, health insurance, asset management, retail banking, wholesale banking, and investment banking. These organizations have the economic capital to support more than one type of business, thereby reducing the risk associated with operating in each sector individually.
Financial services is a broad industry that requires both hard and soft skills to be successful. You can enter this field with a degree, but it’s more important to have strong interpersonal skills and an established network to land a job.