The term “Finance Domain” is generally used to refer to skills and jobs that fall within the finance or financial services industry, a function called finance that is common to all business enterprises, in all industries, and d on the other hand, we have financial institutions Knowledge of the field of finance allows for possible career paths within the financial services industry or with financial institutions.
There is a potential source of confusion regarding what we refer to with the term financial domain. On the one hand, there is a function called finance which is common to all business enterprises, across all industries and we have covered these finance processes under Functional Competencies. On the other hand, there is a financial services industry. Then we have a term that refers to all financial institutions such as banks, brokerages and insurance etc. Knowledge of the financial field allows possible career paths within the financial services industry or with financial institutions.
The financial function
The finance function encompasses a variety of functions, activities and processes. It encompasses finance functions, budget functions, risk and return management, cash flow management, treasury management, financial management, risk and governance, and many other related functions. There are various financial institutions that play a major role in the careers of professionals with knowledge of the financial field.
Main players in the financial market
Let’s talk about the main players in the financial market.
Banks:
A “commercial bank” is what is commonly referred to as a simple “bank”. The main operations of banks include:
- Keeping money safe while allowing withdrawals when needed
- Issuance of checkbooks so that bills can be paid and other types of payments can be delivered by mail
- Provide personal loans, business loans, and mortgages (usually loans to purchase a home, property, or business)
- Issuing credit cards and processing credit card transactions and billing
- Issue of debit cards to replace checks
- Authorize financial transactions at branches or using automated teller machines (ATMs)
- Provide electronic funds transfers and electronic funds transfers between banks
- Facilitation of standing orders and direct debits, so that bill payments can be made automatically
- Provide an overdraft for the temporary advancement of the Bank’s own money arrangements to meet a client’s monthly spending commitments on their checking account.
- To provide an internet banking system to enable customers to view and operate their respective accounts via the internet.
- Provide credit card advances with the Bank’s own funds to customers who wish to settle credit advances monthly.
- Provide a check guaranteed by the Bank itself and prepaid by the customer, such as a cashiers check or certified check.
- Notary service for financial and other documents
- Accept deposits from customers and provide them with credit facilities.
Insurance
Insurance brokerage – Insurance brokers purchase insurance (usually property and casualty insurance) on behalf of clients.
Insurance underwriting – Personal insurance underwriters actually underwrite insurance for individuals, a service still offered primarily through agents, insurance brokers and stockbrokers. Underwriters can also offer similar commercial lines of coverage for businesses. Businesses include insurance and annuities, life insurance, pension insurance, health insurance and property and casualty insurance.
Reinsurance – Reinsurance is insurance sold to insurers themselves, to protect them against catastrophic losses.
Other financial services
Intermediation or advisory services
These services involve stock brokers (private client services) and discount brokers. Stockbrokers assist investors in buying or selling stocks. Primarily Internet-based companies are often referred to as discount brokerages, although many now have branches to assist customers. These brokers primarily target individual investors. Full service firms and private client firms primarily assist and execute transactions for clients with significant capital to invest, such as large corporations, high net worth individuals and investment management funds.
capital investment
Private equity funds are typically closed-end funds, which typically take control of private equity stakes in companies that are either private or become private once acquired. Private equity funds often use leveraged buyouts (LBOs) to acquire the companies in which they invest. The most successful private equity funds can generate returns significantly higher than those provided by stock markets
Venture capital is a type of investment capital usually provided by external professional investors to new businesses with high growth potential with the aim of bringing the business to an IPO or commercial sale of the business .
Angel investment
An angel investor or angel (known as a business angel or informal investor in Europe), is a wealthy person who provides capital for the start-up of a business, usually in exchange for convertible debt or equity. A small but growing number of angel investors are organizing themselves into angel groups or networks to share research and pool their investment capital.
Conglomerates
A financial services conglomerate is a financial services company that is active in more than one sector of the financial services market, for example life insurance, general insurance, health insurance, asset management, retail banking, wholesale banking, investment banking, etc. One of the main reasons for the existence of these companies is the existence of diversification benefits which are present when different types of companies are aggregated, i.e. bad things do not always happen. at the same time. As a result, the economic capital of a conglomerate is usually significantly less than the economic capital for the sum of its parts.
Debt resolution is a consumer service that helps people who have too much debt to repay as requested, but who do not want to file for bankruptcy and want to pay off their owed debts. This debt can be accumulated in a variety of ways, including but not limited to personal loans, credit cards, or in some cases merchant accounts. There are many services/companies that can help you. These can include debt consolidation, debt settlement and refinancing.
Related links
You may also like What is Finance? Meaning, Definition and Characteristics of Finance | What is the Stock Exchange? Meaning Definition and Characteristics | Financial markets | What is the business? The main features of the company | Financial intermediaries – non-depositories | Financial Institutions | Financial assets | Why Learn Finance Domain? | Financial Intermediaries – Custodian | Presentation of the Finance domain | BFSI Industry Overview
Creation Date Thursday, June 21, 2012 Views 38005