Financial services are the economic services performed by the
financial institutions such as banks, insurance companies, mutual
fund companies, credit card companies and government enterprises.
Financial services institutions helps in the overall economic
development of the nation.
Main sectors in the financial services sectors are-
- Commercial Banking Services: It includes a
bank accepting deposits for lending and repayable on demand or at
the end of given period. The primary services of Commercial bank
includes-
- Issuance of chequebooks
- Providing personal loans, mortgage loans and commercial
loans
- Issuing debit and credit cards
- Provide electronic fund transfers
- Providing overdraft facility to customers. 2)
Investment Banking Services: It includes
underwriting services of securities, aid in the sale of securities,
financial advisory services related to merger and acquisitions,
brokerage services, private banking services to to high net worth
clients like wealth management and tax planning etc.
3)Insurance sector: Here, insurance companies
provide hedge services against the risks which are uncertain. An
insurance policy is provided to insured stating the terms and
conditions under which insurer will compensate the insured. Types
of insurance provided are health insurance, life insurance, motor
insurance, casualty insurance, property insurance etc. 4)
Alternative Financial services: It is a financial
services provided to low income individuals outside the traditional
banking services. It includes pay day loans, rent to own
agreements, refund anticipation loans, sub prime mortgage loans
money orders and money transfers. 5)Independent financial
advisor: These provide financial services to their clients
regarding and recommend suitable financial products available in
the market tailoring to their requirements. IFAs advice generally
on investments, retirement planning, insurance and mortgages.
6)Accountancy company: Accounting firms provide
customized services to meet your requirements such as book-keeping,
auditing, tax planning, fraud investigation, outsourcing and
management consultation. 7)Credit card companies:
Here, credit card networks companies such as Master card and Visa
card, authorize and process financial transactions. But credit card
issuers approve your credit card application, set your credit
limits, collect your monthly payment and offer rewards.
8)Real Estate: Real Estate includes services
related to investment in properties, setting the portfolio to
maximize value of their assets and also provide marketability to
their properties. 9)Government sponsored
enterprises: GSE provide credit to targeted sectors such
as farm credit and education sector of the economy to make them
transparent and efficient. 10)Stock Brokerages:
Stock brokerage firm facilitate buying and selling of financial
securities between buyer and seller. These firm usually charge a
brokerage fees on the transactions in exchange of their
services.