Financial services is an industry that encompasses a wide range of industries and business functions. These include investment banking firms, money managers, brokerages, banks, lenders, insurance companies, accounting and tax filing services, credit card companies, and global payment networks like Visa and Mastercard. Additionally, the sector includes debt resolution services and financial market utilities that facilitate stock, derivatives, and commodity trades.
It may seem as though the world of financial services is all-encompassing today, but it wasn’t always this way. In the past, each sector of this industry largely stuck to its specialty. For example, banks offered only checking and savings accounts, while loan associations focused on mortgages and auto loans. Nowadays, however, some companies operate as “conglomerates,” meaning they have multiple divisions that each specialize in a different area of the finance industry.
For example, a bank may have an investment division that invests in stocks and bonds for consumers and another division that offers loans to small businesses through its venture capital arm. These types of conglomerates often have more financial resources than their smaller, independent counterparts and therefore enjoy better access to the lending markets.
Additionally, the specialized skills that are acquired in each segment of the financial services industry often lead to a higher salary than jobs in other sectors. However, career paths in this sector are not for everyone; many people find themselves working long hours, and work-life balance can be difficult to achieve. There are also a number of regulations that must be followed, which can add to the stress of this field.