Financial services is a very broad industry, and as such, there are a lot of different career paths within it. When you start to consider a role in the sector, it’s important to have an understanding of its scope before making any decisions about what kind of job would best suit you and your career goals.
Financial service companies include banks, credit unions, credit-card companies, mortgage lenders, insurance agencies and many others. Each of these sectors offers its own unique products and services. Some of these products and services are consumer-facing, while others are used by businesses or institutions. The industry is regulated by both federal and state governments. This regulation ensures that consumers are protected and that the financial services industry is held accountable for its actions.
Banks offer consumer deposit and loan services. They also often provide investment products like mutual funds, as well as credit cards and other unsecured loans. Other financial services that a bank might offer are check guarantees and money management advice. Banks are typically for-profit ventures, though there are a number of community-based nonprofits that work in this space as well.
Historically, the banking industry was separated into several distinct sectors: savings institutions, commercial banks and loan associations. But the industry began to meld in the 1970s as regulations were loosening and big names in finance started buying smaller banks and financial firms. This consolidation helped spur the growth of multi-service financial conglomerates that offered a wide range of products and services. The Gramm-Leach-Bliley Act of the 1990s further eroded these separations, allowing banks to offer investments and commercial banking services alongside their traditional deposit and lending offerings.
As the global economy has evolved, so too have the needs of consumers and the demands on financial services companies. Today, people want access to more kinds of financial products and services than ever before. These products and services can help them manage their incomes, make better choices about spending and saving, and reduce the risk of debt and bankruptcy.
In addition, the world’s poorest people need access to financial services to grow their businesses and improve their lives. These services can provide them with the capital they need to invest in themselves, build homes and create jobs. Without these options, these people have a much harder time living from day to day and providing for their families.
The future of the financial services industry depends on the ability of its players to balance risk and reward, provide quality customer service and meet rising consumer demands. It also depends on a strong culture of training and development to keep employees up-to-date with the latest tools and techniques available to them. With new technology being introduced to the field nearly every day, it’s imperative that employees have the skills and knowledge needed to stay competitive and relevant. The bottom line is that the industry thrives in an environment where interest rates rise moderately, and there is a healthy balance between strict regulation to protect consumers and free-market opportunities for financial services companies to innovate and expand their product offerings.