When we think about financial services, we tend to think of banks, brokers and mortgage lenders. But this industry is much more broad and encompasses everything that touches money. It includes not only big business, but small community banks, as well as nonprofits and government agencies. Financial services are “everything that has to do with money,” says Ryan Duitch, president and CEO of Arro, a company that provides data analytics to the banking sector.
It wasn’t always so all-encompassing. Before the 1970s, each sector of financial services more or less stuck to its specialty. Banks provided checking and savings accounts, loan associations offered mortgages, credit card companies provided credit cards, while investment firms like mutual fund companies and brokerages invested consumers’ money in stocks and bonds.
With the rise of consumer demand for more services, it became necessary for these businesses to offer a wider range of products. And in an effort to earn more business, they began to merge with each other to provide a full array of options for their customers. This was the birth of the megabanks of today.
These large financial conglomerates now offer almost every service you can imagine. In addition to personal banking, they have credit card and mortgage companies, investment firms, insurance carriers, and even private equity and venture capital providers. It may be hard to keep up with all of these industries, so the best way to stay informed is by reading reputable financial news publications. The Wall Street Journal and Barron’s are two of the most popular, but there are many other options out there as well. Most libraries have subscriptions to these publications, or you can find them at most book stores.
The financial services industry also includes debt resolution companies, global payment providers such as Visa and Mastercard, and financial market utilities that facilitate stock, derivatives, and commodity exchanges. The industry is regulated by independent agencies to ensure transparency and accountability.
A number of challenges are currently impacting the financial services industry. One of the biggest is the repercussions from the COVID-19 pandemic. Banks and credit unions are dealing with customers who have lost income due to the pandemic, making it harder for them to pay their bills. Investment firms and financial advisors must adjust their client portfolios to reflect the uncertainty in the market.
Ultimately, the future of the financial services industry depends on the success of consumers and their ability to adapt to a changing world. Technology has revolutionized the way we borrow, invest and save money. If these businesses don’t embrace new technology and meet their customer’s evolving needs, they will be left behind by more agile competitors.
Here at Phyton Talent Advisors, we encourage you to learn more about the exciting opportunities available in the finance industry. This is a sector where you can build a lucrative career, and help people take control of their finances for good. To get started, check out our job listings or contact us today.