Financial services Essay

This essay has a total of 701 words and 4 pages.

financial services

What is meant by financial services?

Financial services in today's society has become more than what a high street bank can
offer you from behind a counter. It has become a diverse functional area within any
economically adequate society. Throughout this essay I have tried to grasp the main
concepts concerning Financial Services and condense them into an essay of relatively minor
proportions in comparison to the subject matter. I hope I can give you, the reader an
insight into the world of financial services in all its diversity.

So what is meant by "financial services". To be honest there is no straightforward
definition such is the spread of financial services across the business spectrum. We can
however dam different organisation under the heading of financial services to give you an
idea of what financial service intails.

Financial service is understood to include "banking, insurance, building societies, stock
brooking and investment services". These are the 5 main areas described by Brian Anderton
in his 1995 book "current issues in financial services". Brian also found it difficult to
pinpoint a definitive meaning and found it easier to list organisation associated.

Going in to detail when concerning the institution aids in creating a further
understanding of financial services yourself. Of the main financial institutions banks
are the most common. Banks can be either "commercial" or "merchant". Dealing with retail
and investment respectively. Commercial banks are easily found on the high street and rely
on deposits from ordinary people. There is very little interest paid to their savings
accounts however savers can borrow sums of money from the banks from which the banks make
profit from interest on the loan. Merchant banking is slightly more complicated when
dealing with finances and in my opinion is more exciting. Merchant banks arrange finance
deals and charge for this service. This investing is slightly risky and less
straightforward. However the profit rewards outweigh the timescale and effort needed to

Investment institutions such as pensions and insurance companies again take the liquid
earnings of their clients and invest them in a wide range of profit making investments.
Payment to these companies often takes the form of monthly payments taken by debit from
wages. These companies give clients a sense of security, and in the claim free years to
come, the chance of a large windfall payment.

Large investment institution deals with modern day trading, the trading of assets and
debt. It is not fast companies that trade but individual people. In this hectic rat race
people and institutions stand to loose and gain huge amounts of money. Due to the
uncertain nature of this trade, people and institutions are extremely keen to lend as this
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