Financial services refer to the process and transactions that take place when a good is acquired. These can be carried out in different areas, such as the banking sector, the insurance sector, the real estate sector, consumer finance, and so on. For more information: Midway Management
Collect the amounts (premiums) canceled by those who try to insure against certain risks and cover the expenses of those who have had an event covered by insurance, such as: car accident, damage to goods and insured goods, etc.
They can be companies or individuals with large capital, agree to cover some of the risks assumed by the insurance companies.
They can be found as agencies or brokers. They are in charge of contacting people willing to pay to cover some risks, with those who, for a certain amount, are willing to assume them.
Banks and other financial service providers
They accept deposits and reimbursable funds and make loans: They receive money from their savers and lend it or reinvest it in order to benefit from the difference between what they have to pay depositors and the interest they charge to those who received the loan.
Manage payment systems: Banking institutions and financial service providers allow the transfer of funds and enable other transactions. Likewise, thanks to them it is possible to pay bills through credit and / or debit cards, checks, and electronic fund transfers.
They support in the negotiations: They collaborate with the companies in the purchase and sale of currencies and values.
They issue securities: They favor the attraction of funds to the borrowers through the sale of shares and the issuance of bonds.
They manage assets: They advise clients who hire them to receive specialized advice, in investments or they do it on their behalf.
Despite the classification described above, there are no clear distinctions within the financial sector. In this way, people can simultaneously lend or receive various financial services. For example: A mortgage agent in the real estate industry can advise clients in the process of applying for a loan, with the characteristics that suit those clients. At the same time, those customers can also get credit through their cards or from a commercial bank. Likewise, they must purchase insurance policies through intermediaries or directly with the insurance companies in order to cover the risks that their activity or investment may face.
As can be seen from what has already been discussed, the influence of financial services on the productive use of money is evident.