When you think about financial services, you may think of banks, brokers and mortgage lenders. But this vast industry is much more than these three sectors. It includes many different areas, such as investment firms, credit card companies and insurance companies. It also encompasses asset management, which is where pensions and other investments are handled. This is why it’s important to understand the broad range of financial services and what they entail before you consider a career in this sector.
The financial services industry is one of the most important sectors in the economy, allowing individuals and businesses to borrow cash and invest it securely. But this industry is also highly competitive, has thin margins and must comply with strict regulations. As a result, the industry is prone to fraud and has seen many high profile scandals over the past few years.
But despite these problems, there are still plenty of opportunities for those interested in working in this sector. In fact, this industry can be an excellent career choice for those with the right skills and attitude. The job requires intense training, but those who are successful in the field can earn very good salaries and can work almost anywhere in the world.
While the lines between the different financial service sectors seem to be blurred now, it wasn’t always so. Before the 1970s, each sector stayed within its own area of expertise. Banks provided a place for consumers to keep their money, loan associations offered mortgages and loans and brokerage companies offered investing opportunities like stocks and mutual funds. But as the years went by and financial deregulation occurred, these sectors began to overlap. Eventually, banks began to offer all of these things and more as they grew into large financial conglomerates.
This increased competition helped the financial services industry to become more efficient. The industry grew in size and profitability and even managed to help finance the home buying craze of the 1990s by offering subprime mortgages. However, the recent economic meltdown has made some people wary of making a career in this industry.
The financial services industry also provides a boost to the overall economy by encouraging production in all sectors. It helps backward regions catch up with the rest of the country and promotes economic growth. This is important because the more production there is in all sectors, the more demand there will be for products, which will lead to higher prices and higher profits.
In addition, the financial services industry makes it easier for governments to raise long-term funds. This is done by selling securities in the market and can even be used to meet foreign exchange requirements. It is the most important industry for a nation and if there is no stability in this sector, the entire economy will suffer. This is why it’s so vital that the government monitors this sector closely and works to improve it if necessary. With the proper regulation, this industry can continue to flourish and provide a crucial service for people worldwide.
