Overview of the Financial Services Industry

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Financial Services Industry: The overall development of an economy is a major factor that has significant impacts on the development of the economy's financial markets. Since well-functioning financial systems offer good and easily accessible information, they lower the costs of transaction. This in turn enhances resource allocation and strengthens economic growth. The financial services industry consists of various systems such as stock markets and banking systems that enhance growth and help in poverty reduction. However, commercial banks tend to dominate the financial system during low levels of economic development while stock markets become more active and effective during periods of high levels of economic development ("Financial Sector", n.d.). The other important systems in the financial services industry include sound macroeconomic policies, shareholder protection, and good legal systems. Financial Services Industry Analysis: The financial services industry is an economic sector that provides different kinds of products of varying nature to customers and institutions. Some of the major players in this industry include banks, investment brokers, consumer and commercial lenders, stock exchanges, collection agencies, venture capital investors, asset managers, and investment brokerage firms. Generally, these financial institutions tend to be diverse to an extent that they fit into varying risk profiles. These financial firms offer products and services that
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