Payment Systems
The existence of the payment systems and banking services operated by the financial services sector provide the mechanism for the money to be managed, transmitted and received quickly, safely and reliably. Access to the payment systems is an important part of the financial service sectors for individuals.
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Risk
The financial services sector also allows risk to be managed efficiently and effectively using sophisticated derivatives or insurance. These will lead to better coping with global uncertainties such as the changing value of the currencies or extreme weather conditions or major accidents. Investment Chain
Based on investment chain, the savers and borrowers are brought together. Savers will finance the businesses. Businesses may offer opportunities for saver to take part in the growth of the business. This may result in the potential returns. The efficiency of the investment chain is crucial in allocating the uninvested capital to businesses for their own growth. This may lead to an increase in the productivity. The Role of Financial Sector
The financial service sector links the organization needing capital and those with capital for investment. A start up or growing company is an organization which requires capital. The capital can be provided by the pensioners who save for their retirement in a pension fund. Financial services sector play the part of channeling the money invested to those organization that need it. Besides that, financial services sector also provide payment, execution, advisory and management services. The roles provided by the financial services sector may include investment chain, risk and payment system. |
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May 2023
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