2. INTRODUCTION
Financial services refer to services provided by the finance industry.
The finance industry encompasses a broad range of organizations
that deal with the management of money. Among these
organizations are credit unions, banks, credit card
companies, insurance companies, consumer
finance companies, stock brokerages, investment funds and
some government sponsored enterprises. As of 2004, the financial
services industry represented 20% of the market capitalization of this
500 in the United States.[1]
Financial services refer to services provided by the finance industry.
The finance industry encompasses a broad range of organizations
that deal with the management of money. Among these
organizations are banks, credit card companies, insurance
companies, consumer finance companies, stock
brokerages, investment funds and some government sponsored
enterprises.
3. HISTORY OF FINANCIAL SERVICES
The term "financial services" became more prevalent in the United
States partly as a result of the Gramm-Leach-Bliley Act of the late
1990s, which enabled different types of companies operating in the
U.S. financial services industry at that time to merge.[2]
Companies usually have two distinct approaches to this new type of
business. One approach would be a bank which simply buys an
insurance company or an investment bank, keeps the
original brands of the acquired firm, and adds the acquisition to its
holding company simply to diversify its earnings. Outside the U.S.
(e.g., in Japan), non-financial services companies are permitted
within the holding company. In this scenario, each company still
looks independent, and has its own customers, etc.
In the other style, a bank would simply create its own brokerage
division or insurance division and attempt to sell those products to its
own existing customers, with incentives for combining all things with
one company...
4. SCENARIO PRIOR TO LIBERALIZATION
• Excessive Control In The Form Of Regulation.
• Lack of information about International Developments.
• Control over the prices of Securities.
• Non availability of Financial Instruments.
• Strict Regulations of the Foreign Exchange Market.
5. MARKET SHARE OF FINANCIAL
SERVICES
The financial services industry constitutes the largest
group of companies in the world in terms of earnings
and equity market capitalization. However it is not
the largest category in terms of revenue or number of
employees. It is also a slow growing and extremely
fragmented industry, with the largest company
(Citigroup), only having a 3 % US market share.[8] In
contrast, the largest home improvement store in the
US, Home Depot, has a 30 % market share, and the
largest coffee house Starbucks has a 32% market
share
6. MEANING OF FINANCIAL SERVICES
Typically, it means “mobilizing
and allocating SAVINGS”.
It includes all activities involved
in the transformation of SAVINGS
into INVESTMENTS.
Financial Services can also be
called “Financial Intermediation”.
8. IMPORTANCE OF FINANCIAL SERVICES
• Economic • Promotion
Growth of Savings
Financial Contribution to
Intermediation GNP
Creation of
Dominance of
employment
Human element
opportunities
• Capital • Provision of
formation Liquidity
9. CLASSIFICATION OF FINANCIAL
SERVICES-
C-1
Traditional and Modern
C-2 Formal and Informal
C-3 Fund-based and Fee-based
10. TYPES OF FINANCIAL SERVICES
Foreign
Banking Investment
exchange Insurance
services services
services
Asset
Issuance of Currency Insurance
manageme
checkbooks Exchange brokerage
nt
Provide Foreign Hedge fund
personal Currency manageme Reinsurance
loans, com Banking nt
mercial
loans
Wire transfer
ATMs
13. BANKING
Design/Development of Online Consumer Banking
Portal supporting multiple languages & time zones
Retail, Whol
esale, Com Design/Development of common customer
mercial information structure to enable cross-selling
and between Mortgage and Savings Bank customers
Mortgage
Lead generation and credit checking system for
wholesale banking customers.
14. CAPITAL MARKETS
Front-end Design/Development of fixed income
Trading derivatives trading application.
Platform, Risk
Management,
Compliance
Management, Design/Development of portfolio risk data
Order mart.
Management, F
und Accounting Functional and regression testing for a foreign
exchange derivatives trading system.
15. CREDIT SERVICES
Design/Development of compliance
Risk management system for credit derivatives.
Management,
Compliance
Management,
Credit
Application Interfacing of a home grown pricing engine a
credit management package.
16. TRANSACTION SERVICES
Design/Development of a funds transfer
system
Equity/Fixed compliant with Single Euro Payment Area
Income Back- (SEPA).
end
Processing, Fun
ds
Transfer, Compli Design/Development of a prototype system
ance providing
Straight Thru Processing
17. MUTUAL / HEDGE FUNDS
Design/development of a comprehensive
data warehouse to track customer profiles and
funds profile for a leading mutual fund
company.
Portfolio/
Customer/ Design/development of a comprehensive
Compliance data warehouse to track customer profiles and
funds profile for a leading mutual fund
management company.
and reporting
Design/development of a test harness and
execution of functional and load tests for
online mutual fund portal using Mercury
Interactive QA tools.
18. INSURANCE
Design/Development of online quote/binding
system for auto insurance.
Life, Auto,
Property &
Casualty, Healthcare comparison shopping online
Health portal.
Comprehensive data warehouse for
compliance reporting for a Life Insurance
Company.
19. FINANCIAL SERVICES
MODERNIZATION ACT (1999)
• Transformed the banking industry.
• Eliminated many restrictions among companies in the-
Securities
banking, and
Insurance industries.
20. FINANCIAL SERVICES AND PROMOTION
OF INDUSTRIES
• Industrial promotion through Merchant Banking Services
• Working Capital Finance Through Factoring Services
• Equipment Finance through Leasing
• Financial resources through Mutual Funds
• Long-term Risk Capital through Venture Capital
• Risk Management through Derivatives
• Debenture issue through Credit rating
• Development Finance through Development Banking Sector
• Industrial Development through Specialized Services
21. FINANCIAL SERVICE COMPANIES
Financial services companies thrive on quick, but
accurate decisions with equally agile competitors
fighting for every transaction within the constantly
changing regulatory framework, which is different in
every country. Keeping up with the fast-changing
requirements for quick decision making, operational
efficiency, accurate accounting and regulatory
compliance makes the business processes and
hence the IT systems very complex and dynamic.
22. FINANCIAL SERVICES INDUSTRY
The financial services industry relies heavily on its
information systems and technologies, thus
continuously investing in acquiring, upgrading and
maintaining systems, data and infrastructure.
Robust, responsive, secure, high quality, reliable and
accurate infrastructure and software backbone
is absolutely essential to survive and thrive in this
competitive industry
23. WHAT IS THE FINANCIAL SERVICES
INDUSTRY:
There is a potential source of confusion regarding careers in
finance. On the one hand, there is a function called finance
that is common to all business enterprises, in every industry. On
the other hand, there is a financial services industry. The primary
focus of this guide site is on the latter definition. Additionally,
note that the finance function is but one of many possible
career paths within the financial services industry.
The financial services industry includes firms that are engaged in
activities such as investing, lending, insurance, securities trading
and securities issuance. This is not an exhaustive list, but these
companies can be characterized as being in one or more of
the following lines of business:
Example- Banking, Insurance, Securities Brokerage (or Financial Advisory Services),
Investment Banking, Securities Trading, Investment Management (or Money
Management), Securities Analysis, Financial Planning, Wall Street
![INTRODUCTION
Financial services refer to services provided by the finance industry.
The finance industry encompasses a broad range of organizations
that deal with the management of money. Among these
organizations are credit unions, banks, credit card
companies, insurance companies, consumer
finance companies, stock brokerages, investment funds and
some government sponsored enterprises. As of 2004, the financial
services industry represented 20% of the market capitalization of this
500 in the United States.[1]
Financial services refer to services provided by the finance industry.
The finance industry encompasses a broad range of organizations
that deal with the management of money. Among these
organizations are banks, credit card companies, insurance
companies, consumer finance companies, stock
brokerages, investment funds and some government sponsored
enterprises.](data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7)