When is a bank not a bank? The answer is easy: when it is a financial services provider!

The last ten to fifteen years have seen major upheavals in the financial services sector, particularly retail financial services. The major 'banks' in the UK for example have been facing fierce competition from building societies that have converted from mutual status to public limited companies, and from insurance companies, supermarkets and other 'financial services providers' that have begun to offer 'banking services'. At the same time, 'banks' have started to offer a wider range of services than those traditionally associated with the sector. Many have dropped the word 'bank' from the title.

Another critical issue is that of increasing regulation. The Bank of England's role as regulator for banking services has passed to the Financial Services Authority, a newly formed body that also takes responsibility for regulating retail investment business, such as the sale of pensions and insurance, investment management, and trading in stocks and shares. Areas currently unregulated - mortgages, for example - are unlikely to remain so for long.

Technology has had a major impact on the world of financial services, just as on other areas. 'Plastic cards', with all their convenience to customers, have superseded cheques in many instances; the growth of ATMs (automated teller machines or 'cash-points'), 'call centres' offering telephone banking 24 hours a day, 365 days a year, and 'PC' or internet banking, has reduced the need for customers to come into branches when they can undertake transactions like paying bills or checking balances themselves. Effectively, banks have 'outsourced' many of their traditional functions - to the customer! The increasing automation of the old 'banking' functions has also led to greater levels of specialisation within banks.

The last ten years have also seen a radical shift in staffing patterns. One impact of the accelerating use of technology has been the 'downsizing' of staff in the UK banks, whilst increasing focus on customer service in the face of competition from new players has seen a move to critical or part-time workers.

The picture in developed countries is very similar to that in the UK: with the launch of the Euro, the problems of converting currency within the member States will vanish, with benefits to trade. Developing countries and those changing over to market economies will undoubtedly follow similar patterns, in order to ensure that they have a financial services industry robust enough to be able to meet the demands of the next millennium. .

So where does this leave the graduate seeking employment within the retail financial services industry? Certainly not at a disadvantage! The industry, particularly in the UK, has to a great extent dispensed with 'tiered' recruitment for its potential management staff. There is a greater emphasis on recruiting graduates or short-term contract staff.

Training and development policies within organisations have one thing in common: they are all focused on the bottom line. One of the key qualities sought by recruiters, in this fluid and swiftly changing industry, is the ability to cope with and manage that change. Recruits are also generally put through an induction programme - a mix of formal and on-the-job training. Many companies also have special programmes for the 'high-flyers' destined to become the senior management of the future.

But increasingly, staff are responsible for managing their own career - the old 'job for life' of the traditional bank is long since dead. The upside of this change, however, is empowerment; bargaining power for bright recruits who demand the highest quality development, and a wealth of opportunities for focused graduates to move around within or without financial services, taking a 'portfolio' approach to managing their careers.

There is a wide range of qualifications and training opportunities available to help staff do this. One of the leading providers of financial services education, in both the UK and overseas, is the Institute of Financial Services, which develops and delivers a range of qualifications examined and awarded by its parent body the Chartered Institute of Bankers. These qualifications include a Diploma in Financial Services Management, and a BSc (Hons) in Financial Services and Associateship awarded jointly by the Institute and UMIST (the University of Manchester Institute of Science and Technology). These qualifications give students a broad understanding of the financial services industry, and management topics such as marketing, accountancy, information systems and management, whilst also offering electives that allow specialisation.

Holders of post-graduate qualifications in the UK are generally treated in the same way as first degree holders. However, the situation is likely to be different in other countries, where greater emphasis may be placed on higher degrees.

The wider issue is: what challenges face the financial services industry in the next millennium? Competition, both on the national and international fronts, will no doubt result in more mergers and take-overs. Increased regulation in order to protect the consumer and the industry will be a necessity. The European Union has already chosen Frankfurt, Germany as its financial centre and as the EU increases its membership over the coming years, the Euro will be on a par with the US dollar as a benchmark currency.

Technology has already placed its indelible mark on financial services. Cheques are likely to become a thing of the past, together with individual currencies. SMART cards, the Internet, credit and debit cards, and home shopping all contribute to a 'cash-less' society - the convenience of being able to have your money on a plastic card in your wallet or purse is now a reality.

Graduates able to thrive on this diet of intensive change will find a career in retail financial services both challenging and rewarding.

Author:

Rachel Gosling, Chartered Institute of Banking