What Is a Financial Service?

Financial services

When people think of financial services, they often envision banks, brokers and mortgage lenders. But the industry is much more broad than that. It encompasses everything from small community banks to Wall Street firms, as well as insurance companies and credit and financing organizations. The sector also includes providers of critical financial market utilities like stock and commodity exchanges and payment systems.

A financial service is an activity that helps individuals and businesses manage their finances, obtain and use credit, invest capital, and take on risk. It includes depository services, such as checking and savings accounts; credit-card issuing; investment management; financial leasing; payment, money transfer and settlement services; securities trading and underwriting; and auxiliary, advisory and intermediation services.

Without access to financial services, families would have difficulty storing and using their savings. Many poor families store cash under the floorboards or in a safe, and others invest their savings in livestock and jewelry – highly inflexible forms of saving that can easily be stolen or lost. Financial services can increase household incomes and allow families to purchase consumer durables, construct or improve their homes, and expand their businesses.

Choosing the right financial services for your needs is essential. Be sure to compare fees, customer service and reputation before selecting a provider. Also, regularly reassess your selected services to ensure they align with your evolving financial goals and aspirations. And remember, if you have questions about your financial service options or need assistance finding a new one, the Pocketbook Agency is here to help!