Financial services are the industries that provide individuals, companies and institutions with access to credit, investment funds, insurance and more. This sector has a significant impact on the economy as a whole, as it provides people with the money they need to purchase goods and services. It also helps them save for the future, secures their assets and health with insurance policies, and safeguards their investments with accounting and tax filing services.
If you’re looking to make a change in your career, a role in the financial services industry could be perfect for you. It’s a diverse sector with plenty of options, from mortgage lenders to credit card providers and Wall Street securities traders. But it’s important to understand what exactly financial services encompasses before you jump in head first.
Banking services include deposit-taking; lending (including financial leasing and hire purchase); payment and money transmission services; remittances; security brokerage and underwriting; securities trading and market making; asset management and custodial services. It also includes the provision of advisory, intermediation and auxiliary financial services (such as credit reference and information services; securities and commodities market-making; and other specialized financial services).
Insurance services include life, non-life and general insurance; reinsurance; and private equity. Other services provided by the insurance industry include actuarial science, risk assessment, underwriting and claims settlement.
A strong financial services industry is essential for any country. It enables businesses to expand, employees to find well-paying jobs, and consumers to get the things they need. Its influence goes beyond just providing loans and investments, as a healthy financial services industry also ensures that everyone is paid for their work by protecting them from catastrophic losses through insurance policies.
For many people, the most visible aspect of financial services is insurance — health, auto, home and renters’ insurance are all common types of coverage that help mitigate unexpected costs. Other common services provided by the industry include savings and checking accounts; payment system infrastructure (including global payments networks such as Visa and MasterCard); debt resolution; and accountants and tax filing services.
Regulatory bodies are independent organizations that oversee different parts of the financial services industry, upholding transparency and ensuring clients’ rights are protected. Examples include the Financial Industry Regulatory Authority and the Office of the Comptroller of Currency.
Customers don’t make big financial decisions when their banks want them to — they happen at pivotal points in their lives, such as getting married or buying a house. This is why banks need to be able to predict these life events and deliver the right product at the right time. They can use customer data to see when their customers are likely to need certain products and services, then personalise interactions through email or live chat. They can even digitalise slow manual processes to cut out friction. For example, Spar Nord used Salesforce Financial Services Cloud Einstein to improve their online experience and bring a more personal touch to their physical channels.