When it comes to an economy, a country’s financial sector is critical. It’s the sector that empowers consumers to build wealth, manage their debt, and save for future investments. It’s also the sector that helps companies raise capital to expand or grow, and it supports a nation’s overall economic health. If the financial system fails, it can bring down a nation’s entire economy. So when it comes to choosing a career, a solid understanding of the different financial services groups is essential. To help you, Pocketbook Agency has broken down what each group does and how you can find your place in the industry.
Financial services, which vary by country, include central banks, depository institutions, credit unions, credit-card companies, insurers, pension funds, and firms engaged in financial intermediation or asset management. Some of these companies specialize in a particular aspect of finance, such as investment banking or debt underwriting. Others offer broader services like payment systems, such as debit and credit cards and electronic fund transfers.
The quality of financial services depends greatly on trust, especially between savers and borrowers. For example, purchasers of life insurance expect the company they purchase it from to be around when the policyholder passes away, paying out to their designated beneficiaries. Consequently, these types of companies must be heavily regulated to ensure they’re operating ethically and fairly. This is why many countries have specialized financial services authorities to oversee and regulate these kinds of organizations.