Financial services are the products and services that enable individuals and businesses to manage their money. They include banking, credit cards, mutual funds and insurance. These services help people invest in stocks, bonds and other assets, protect them from risk (such as loss of income or property) and facilitate transactions between businesses and individuals.
A strong financial services industry and economy are vital to a nation’s economic growth, as they provide the free flow of capital and liquidity in the marketplace. This encourages businesses of all sizes to thrive, and it gives consumers more purchasing power for goods and services, including those that address basic needs like clean water and sanitation.
The core function of financial services is to channel cash from savers to borrowers. They also redistribute money and risk, aggregating savings from many depositors to make loans and reducing the impact of defaults by pooling deposits in insurance policies.
In addition, financial services companies offer advisory and investment services to clients, helping them make informed decisions about investing their money. They also oversee and regulate the industry, ensuring fairness and transparency for all players.
The financial services sector includes a wide variety of different jobs, from customer service to accounting to lending. The pay in this field is typically competitive and varies widely depending on the specific role. A degree is not always required, but it’s important to have good interpersonal skills to succeed in the sector.