The financial services sector includes thousands of depository institutions, providers of investment products, insurance companies, credit and financing organizations and more. This industry is crucial to the economy because it allows consumers and businesses to put their money to work, either by saving it or lending it out. A healthy financial services sector also provides a safety net in case of emergency by offering insurance coverage to individuals and businesses.
Banks are one of the foundations of the financial services industry. They primarily take in deposits and loans and make a profit from the interest rates they charge on credit cards, loan fees, and the spread between the money they pay depositors and the amount they receive from borrowers. Banks also provide many other financial services like checking and savings accounts, credit card payments and transaction processing, issuance of securities (like stocks and bonds), foreign exchange, brokerage, and asset management.
Other institutions that make up the financial services sector are brokerages and private banks. Brokerages sell shares and options to individual investors, while private banks offer banking services exclusively to high-net worth individuals. These companies may also perform other duties like advising and managing assets, investing funds on behalf of clients, and even trading debt or commodities.
As a career, financial services offers many opportunities for advancement and flexibility. It is also a fairly secure field, providing workers with the opportunity to switch jobs and locations without much risk. This makes it a great choice for someone who wants to maintain a balanced lifestyle between work and personal life.