What is a major function of finance companies?

A major function of finance companies is to extend credit to individuals and businesses that may have difficulty obtaining loans from traditional banks due to past credit troubles. These companies often specialize in providing financing options to those deemed higher risk, offering a lifeline to consumers with poor credit histories.

Finance companies typically provide personal loans, auto loans, and other types of credit products, focusing on individuals who require more flexible lending criteria. This can help people rebuild their credit over time by demonstrating their ability to manage new debt responsibly.

In contrast, other options such as providing investment banking services, insuring bank deposits, or offering stock trading platforms are functions that fall within the purview of different financial institutions such as investment banks, insurance companies, and brokerage firms, respectively. These entities have distinct roles in the financial ecosystem that do not overlap with the primary focus of finance companies on consumer and small business credit.