Financial services are all around us, from banks that offer checking accounts and mortgages to investment firms that manage mutual funds. The industry also includes credit-card companies, credit unions, and even some non-profits that offer counseling services or money management advice. But it is important to distinguish between financial services and financial goods. “Financial services are everything that touches money,” says Ryan Duitch, president and CEO of Arro. “That could mean anything from a credit-card transaction to a loan.” Financial goods are products like cars and houses that people purchase or lease, while financial services encompass all the processes that support those purchases.
A healthy financial services sector is a critical component of a strong economy. It helps businesses expand, and it allows individuals to make large purchases and save for retirement or other goals. In addition, it supports the free flow of capital and market liquidity.
While the financial services industry may seem all-encompassing, it wasn’t always this way. Historically, each sector of the industry more or less stuck to its niche. Banks offered checking and savings accounts, mortgages, loans, and investments. Loan associations offered mortgages and personal loans, while brokerage companies sold stocks, bonds and mutual funds.
With the advent of technology and regulatory changes, many institutions in the financial services sector are shifting toward a personalized approach to customer service. For example, Norwegian banking company Spar Nord uses Salesforce Einstein to deliver predictive recommendations based on customer data that helps them deliver a more relevant and engaging experience across all channels.