Financial Services Providers
Financial Services Providers: An Overview
- Financial services providers include organisations that manage money, credit and investments such as banks, insurance companies, and investment firms.
- They offer services such as current and savings accounts, loans, credit cards, insurance policies and investment opportunities.
Banks and Building Societies
- Banks and building societies are where most people keep their money. They offer services like current accounts, savings accounts, loans, mortgages, and credit cards.
- A current account is used for everyday banking needs, such as receiving wages and paying bills. It often comes with a cheque book, debit card, and online banking facilities.
- A savings account usually offers a higher interest rate than a current account, encouraging you to save. These accounts may limit the number of withdrawals you can make.
- Loans and mortgages are forms of borrowing. Banks lend you money, which you must repay with interest over a set period. A mortgage is a loan for buying property.
Credit Card Providers
- Credit card providers lend you money through a card. You can use a credit card to buy goods or services now and pay for them later.
- They charge interest on the money you borrow. The interest rate can be high, especially if you don’t pay off the balance in full each month.
- Credit cards can be useful for spreading the cost of large purchases. However, they should be used carefully to avoid getting into debt.
Insurance Companies
- Insurance companies provide protection against financial risk. You pay a regular premium, and the company pays out if the event insured against occurs.
- Types of insurance include car, home, travel, pet, health, and life insurance. The type and level of cover you need will depend on your circumstances.
Investment Firms
- Investment firms help people and companies invest their money. This can help your money grow, but it’s also riskier than keeping it in a bank.
- They can offer a range of investment options, including shares, bonds and funds. These all carry different levels of risk and potential returns.
Remember, the aim of all financial services providers is to make a profit. Therefore, it’s important to compare the products and services they offer and make sure you are getting the best deal for your personal financial needs. Always read the small print and make sure you understand the terms, conditions, and fees before signing any contracts.