Financial services can be defined as, activities, benefits and satisfactions, connected with the sale of money, that

offer to user and customers financial related value. Supplier of financial services includes the following types of institution: 1. Banks and financial institutions 2. House building societies 3. Insurance companies 4. Credit card issuer companies 5. Investment trust and mutual funds 6. Stock exchanges 7. Leasing companies 8. Unit trusts 9. Financial companies and so on

Character sticks of financial services: 1. Intangible: cannot appeal to a buyers sense of touch, taste, smell, sight or hear. 2. Direct sale: simultaneous production and distribution of financial services is undertaken by the service organisation 3. Heterogeneity 4. Fluctuation in demand 5. Protect customers interest 6. Layout intensive 7. Geographical dispersion 8. Lack of special identity 9. Information based 10. Require quality labour Kinds of Financial Services: can be classified into two categories. Asset based/ fund based services Fee based/advisory services Asset based/ fund based services 1. Equipment leasing/finance

2. Hire purchase and consumer credit 3. Bill discounting 4. Venture capital 5. Housing fianc 6. Insurance services 7. Factoring etc. The fee based services: 1. Issue Management 2. Portfolio management 3. Corporate counselling 4. Loan syndication 5. Merger and acquisition 6. Capital restructuring 7. Credit rating 8. Stock broking and so on. Financial intermediaries Financial institution (such as a bank, credit union, finance company, insurance

company, stock exchange, brokerage company) which acts as the 'middleman' between those who want to lend and those who want to borrow. Financial institution, such as a commercial bank or savings and loan association, that accepts deposits from the public and makes loans to those needing credit. By acting as a middleman between cash surplus units in the economy (savers) and deficit spending units (borrowers), a financial intermediary makes it possible for borrowers to tap into the vast pool of wealth in federally insured deposits-accounting for more than half the financial assets held by all financial service companies-in banks and other depository financial institutions. The movement of capital from surplus units through financial institutions to deficit units seeking bank credit is an indirect form of financing known as intermediation-consumers are net suppliers of funds, whereas business and government are net borrowers. A bank gives its depositors a claim against itself, meaning that the depositor has recourse against the bank (and, if the bank fails, the deposit insurance fund protecting insured deposits), but has no claim against the borrower who takes out a bank loan.