Financial services are the economic services provided by the finance industry, which encompasses a broad range of businesses which are generally managing money, including credit unions, banks, credit-card companies, insurance companies, accountancy companies, consumer-finance companies, stock brokerages, investment funds, individual managers and some government-sponsored enterprises. Globally, the financial services industry leads the world in terms of earnings and equity market capitalization.
A Financial Service Provider is a business offering financial advice and/or intermediary services (such as brokerages, insurance companies etc), and is made up of key individuals, these people are responsible for the FSP and all the representatives who work for the FSP. They are also the people who have to report to at least a particular regulator; and representatives, these are the people who will give advice on financial services to prospective policyholders and will conclude all the necessary intermediary services.
Banking is the business activity of a bank. Which is generally categorised into accepting savings, lending money, leasing properties, paying for cheques, providing mortgage facilities, acting on to standing orders, statement of instructions, providing safety locker facilities for valuable assets, providing over draft facilities to current account holders, acting as institutional investors in financial market, issuing ‘letter of credit’ in the business of import and export, act as money changer, issuing travelers’ cheques are some of the activities carried out by modern banks in the banking industry.
a. Commercial Banks (Banking)
Commercial banking services are the foundation of the financial services group. Commercial banks operations include accepting deposits and providing security and convenience to their customers. Part of the original purpose of banks was to offer customers safe keeping for their money. Commercial banks also make loans that individuals and businesses use to buy goods or expand business operations.
b. Investment Banks (Wealth management)
An investment bank is a financial intermediary that performs a variety of services. Most Investment banks specialize in large and complex financial transactions, such as underwriting, acting as an intermediary between a securities issuer and the investing public, facilitating mergers and other corporate reorganizations, and acting as a broker or financial advisor for institutional clients.
Expert advisory services help both people and organizations with a variety of tasks. Financial advisors can help with due diligence on investments, provide valuation services for businesses, aid in real estate endeavors, and more. The Advisory service are generally, providing insights and challenges of financial products available in the market.
a. Brokerage Firms
The middleman that connects buyers and sellers. A full-service brokerage company provides a professional financial advisory on all investment decisions and continue to provide ongoing advice and support. These companies also offer up-to-date stock quotes, research on economic conditions, and market analysis.
3. Wealth Management
Wealth management is an investment-advisory discipline which incorporates financial planning, investment portfolio management and several aggregated financial services offered by a complex mix of asset managers, custodial banks, retail banks, financial planners and others. This includes advice on the use of various estate planning vehicles, business-succession or stock-option planning, and the occasional use of hedging derivatives for large blocks of stock.
Insurance is a contract, represented by a policy, in which an individual or entity receives financial protection or reimbursement against losses from an insurance company. Insurance companies provides coverage designed to help protect a corporation or an individual against loss, theft, or damage to their property. The insurance companies make this possible by sharing risk among a large group of people.
5. Mutual Funds
A mutual fund is an investment vehicle is offering multiple parties share in for the purpose of investing in securities such as stocks, bonds, money market instruments and other assets. Mutual funds are operated by professional money managers, not the investors themselves. The money manager would allocate the fund’s investments and attempt to produce capital gains and/or income for the fund’s investors. The portfolio is structured and maintained, so they are a popular option for people who are a little hesitant with their finances. The investments are also diversified, which helps to mitigate risk.