Challenges Facing the Financial Services Industry

Financial services

The Financial services industry is comprised of everything that touches money. It helps secure a product or support its purchase, provides advice on how to manage your savings, and facilitates transactions and account settlements. As the world continues to face health crises, the Financial services industry is facing many challenges. Here are some of the challenges facing the industry today.

Financial services are everything that touches money

Financial services encompass a range of products and services that help people manage their money and buy the things they want. Some of these products and services include credit cards, mortgage lenders, personal loans, and student loans. Many of these products also have rewards programs to entice people to use them. For example, American Express rewards members who spend money in restaurants or gas stations by giving them points.

Aside from financial products and services, financial services include mortgage inspections and appraisals. They also include all the institutions that handle payments and process money. These include traditional banks, credit card issuers, and emerging challengers.

They give advice on how to make the most of your savings

The best way to make the most of your savings is to put it to good use, says Manisha Thakor, certified financial planner and financial educator at MoneyZen in Portland, Oregon. She suggests that you use your savings to cover emergencies and ride out stock market downturns. You also may want to consider using a combination of different strategies to maximize your savings.

They protect deposits

Deposit insurance is an important concept in the financial services industry. It protects bank deposits against the risk of bank failures. While banks are businesses that are dedicated to making profits, they sometimes act imprudently or take unnecessary risks. Therefore, deposit insurance can protect the depositors from these risks and help the banking system remain stable.

FSCS protection can cover up to PS85,000 per individual depositor, and up to PS170,000 for an entire financial institution. However, this protection applies only to banks with a banking ‘authorisation’. It does not apply to separate accounts or banks, though banks that are part of the same group may share a single FSCS license.