The Financial Services Sector

Whether you need to finance the purchase of a new car, open a business, save for retirement, or simply build your wealth through investing, the financial services sector provides many options. This sector advances money for businesses to grow, grants mortgages to homeowners, offers investment opportunities through brokerage firms, and manages risks through insurance policies.

A healthy financial services industry is vital to a country’s economy. It gives small businesses and large corporations access to capital for expansion, helps homeowners afford to buy homes and apartments, and builds savings for individuals to use in the future.

Today, the lines that separate different financial services sectors are blurred. Banks no longer stick to their core products, and brokerage companies offer more than just stocks and mutual funds. As deregulation swept the markets in the 1990s, financial service conglomerates emerged that offered consumers a full range of products and services.

The financial services industry also includes the private equity funds that invest capital in exchange for ownership stakes or profit participation. Angel investors and venture capital providers also play an important role in supplying investments for startup businesses. Financial services also include the insurance companies that protect people or businesses against death, loss of income, property damage, and liability. Some of these firms also provide credit cards. Regardless of the size or focus of the financial services firm, all provide valuable and essential services to the public. For example, the services of a bank include checking and savings accounts; providing a cashier’s or certified check; accepting deposits and offering loans; allowing customers to shop with credit cards; and more.