Financial services are economic services provided by the finance industry. They include a variety of businesses, such as banks and credit-card companies. Financial services also include investment companies and investment advisors. Often, people who use these services are in the financial industry for a variety of reasons, such as to save for retirement or buy a home.
Investment companies
Investment companies provide financial services to investors by making investments on their clients’ behalf. In return for this service, these companies charge clients a percentage of the profit or asset value. They are regulated by the Securities and Exchange Commission (SEC).
Investment advisors
An investment advisor can help you make the right financial decisions for your future. When you meet with an advisor, he or she will ask you a series of questions to determine your needs and objectives. He or she will also explain their compensation structure and how they minimize conflicts of interest. They will also let you know what type of fiduciary responsibility they have for your account.
Discount brokerages
Discount brokerages provide trading services at very low costs. Unlike traditional brokers, discount brokerages don’t interfere with your investment decisions and don’t charge you extra for research or consulting services. This makes them a good alternative for those who want to make smart financial decisions without spending a fortune.
Insurance underwriting
Insurance underwriting is the process of assessing risk and deciding whether to provide an insurance policy. It involves analyzing different factors, including the insured’s age, medical history, occupation, hobbies, and financial situation. The process determines whether or not to insure a person or business, as well as the amount of coverage required. It also determines the insurer’s financial responsibility for the insured in the event of an unexpected or catastrophic event.
Payment systems
There are a variety of payment methods used in the financial services industry. Many of them are electronic and rely on banking networks for transfer. For example, electronic funds transfers (EFT) are scheduled transfers between two bank accounts. These are often used to pay suppliers and to meet payroll obligations. Direct debits are deferred funds transfers, usually made by banks on behalf of their clients. These payments are made from a client’s bank account to a business’s account.
Digital financial services
Digital financial services are the delivery of traditional financial services via computers, tablets, and smartphones. This can help underserved communities and make financial services more accessible.