The financial services sector encompasses a broad swath of economic activity from retirement and investment companies to mortgage brokers and banks. Financial services firms serve individuals, businesses and governments. The sector includes banking, insurance, investment, credit and debt management, as well as asset managers. In addition, it is responsible for providing credit rating agencies, brokerage firms, and the exchanges that facilitate stock, commodity and foreign exchange trades.
Many of the firms in this sector are regulated by government bodies. This means that the services they offer are subject to a strict set of rules and standards. While this provides stability and security, it can sometimes hinder innovation. As a result, the industry is undergoing significant change. This is particularly true of the retail banking business, where traditional banks are facing increased competition from eCommerce firms and other digital players.
The sector is also being squeezed by regulatory pressure to cut costs and improve customer service. This has led to consolidation among financial services companies. Large companies are acquiring smaller rivals in order to expand their product offerings and increase market share. This is a trend that is likely to continue as the global economy becomes increasingly digitized.
When most people think of the term financial services, they probably imagine banks, brokers and mortgage lenders. However, that is a very narrow view of what the industry actually entails. In reality, the industry is much broader than that. It is made up of all the firms that touch money in one way or another. This includes everything from hedge funds and investment banks to small community banks and nonprofits. It also includes insurance companies, credit unions, pension funds and even the government. It is important to distinguish between financial services and financial goods. Financial services include all the activities that help people manage their money, while financial goods are the actual items that they purchase with that money. For example, an orange is a consumer good that someone might buy, while an insurance policy is a financial service that protects a person from unforeseen events.
Financial services are a key part of the economy, and they play an essential role in people’s lives. While there are a number of pros and cons to working in this field, it is an excellent career choice for anyone who enjoys interacting with customers and solving complex problems. The skills that you learn in this field are highly transferable, and you can find a position in almost any industry if you work hard. Those who are willing to embrace technology and move with the times will have the best chance of remaining competitive in the future. To make this happen, they must use data analytics to understand their customer and deliver personalized financial services. To achieve this, Spar Nord, a leading Nordic bank, used Salesforce Cloud Einstein to transform their customer engagement. This allowed them to digitalise slow manual processes and set up meetings with customers that were more relevant and timely.