Financial services are economic services provided by the finance industry which encompasses a wide range of businesses that provide banking, investment, insurance and credit. The sector is one of the largest and most important in the world. Careers in the industry offer a variety of challenges, rewards and opportunities for professional growth.
Banking services include handing deposits into savings accounts and lending money to customers. Banks make a portion of the funds they hold available for loans by setting aside 10% of their total assets, as required by law. Other financial services provided by the banking sector include money market, mutual funds and mortgages.
In the investment banking subsector, financial services firms help individuals and organizations raise capital through securities like bonds and stocks. They also assist with mergers and acquisitions, offering consulting advice on financial matters.
Insurance is an essential service provided by the financial services industry. It helps protect people against financial loss in case of death or disability, or property damage. Financial services also enable people to invest in projects with high returns, which is another way that they create wealth.
The presence of financial services is also crucial for the development of a country. A robust economy can only grow when there is a healthy financial system in place, and this sector drives the rest of the economy. A growing financial sector means more jobs, greater confidence and increased purchasing power for the people. Moreover, it helps the tertiary or service sector to grow, which is an important indicator of a well-developed economy.