3 Main Financial Service Sectors We Have
What does the financial service sector mean? One way to explain the term financial services is to first understand what financial sectors we have and how they affect or impact our daily lives and activities. The financial sector is companies, firms, or organizations that bring together people who need funds and those who can provide the needed funds. For instance, the bank as a financial institute/sector provides funds for customers when they need it, helps promote savings, ensures financial security, and generally helps customers manage their funds. Other financial services provided may include Investment services, Foreign exchange services, Credit card networking, Insurance, etc.
There are different financial sectors that currently exist just like the ones listed above, and each sector performs one function or the other that contributes to the world’s economy.
Financial service is a fraction of the world’s economy that facilitates the different financial transactions in the world’s financial market. So, just like we have the agricultural sector that offers services like producing and caring for crops, the financial sector offers financial services to customers and also helps improve the economy of the nation.
What are The Main Financial Service Sectors?
Below is the main financial service sector that exists, each providing unique financial service to people and corporations.
Commercial Banking Services
The commercial banks are the everyday retail banks you see. This sector is more popular amongst people because it is used every day for different financial transactions. The commercial banking sector accepts cash deposits, manages customers’ funds, performs foreign exchange, and also Ensure security of funds.
Insurance companies are there to help people and other companies manage losses and mitigate risks that may occur in the future.
Investment services sector perform more complex financial transactions and services like acting as financial advisors for companies, coordinating company mergers or acquisition, providing access to the stock market and other capital markets, and so on.