The Financial Services Industry
Whether you’re looking for investment opportunities, a way to finance your next home or a credit card that gives you the ability to make international purchases, financial services companies provide a wide range of products and services. These professional firms are important to our economy and help boost our daily lives.
There are four types of services that make up the financial industry: depository institutions, providers of investment products, insurance companies and credit and lending organizations. These companies offer economic services to individuals and businesses, including the lending of money (banks), payment processing, securities trading and debt management.
The depository sector focuses on collecting savings from depositors and lending funds to those who need it. These funds can be deposited in checking or saving accounts and invested through mutual funds, stocks and bonds. The investment services industry consists of private equity funds, venture capital providers and angel investors who invest in new or existing technology and service businesses. In addition, the insurance industry offers financial services to protect against life events or property loss.
The financial industry also includes accounting and tax filing services, foreign exchange bureaux, global payments networks like Visa and MasterCard, and debt resolution services. However, the 2008 global financial crisis showed that the industry must also work to improve its culture and create socially responsible products and practices. To achieve this, companies must align their incentives and targets with society’s needs and improve the behaviour of their employees.