What Are Financial Services?
Financial services are the economic services provided by the finance industry, which encompasses a broad range of service sector firms that manage money and offer financial products and solutions. These include credit-card companies, bankers, insurance brokers and agents, investment banks and mortgage lenders. The sector is regulated by independent agencies that oversee different financial institutions to ensure they are operating transparently and fairly.
While it might seem like the financial industry is all-encompassing today (banks offer checking and savings accounts, loan associations provide mortgages, brokerage firms sell investments and credit card companies provide credit cards), it wasn’t always that way. Back then, each sector of the financial services focused on its niche.
During this time, a number of important developments took place in the industry. For example, in the 1990s, deregulation allowed banks to expand their offerings by combining banking, investment and commercial lending into one company. This helped fuel the home buying craze of that decade and led to the formation of large multi-service financial conglomerates.
Another key development in the industry is the growth of digital financial services. This allows individuals to manage their finances from anywhere in the world using a computer or mobile phone. This has made it possible for millions of formerly excluded people to access banking services, enabling them to save, invest and achieve their financial goals.