Month: January 2021

flexible payment
ArticlesFinanceFundsRegulation

Flexible Pay: Could it Become a New Trend Amid Pandemic?

flexible payment


In the light of the pandemic many are experiencing financial difficulties and are feeling the pressure of waiting for payday. Research carried out by Money Advice Service has previously discovered in the UK there 8.3 million adults who have found meeting monthly bills a “heavy burden” and have missed more than two bill payments in a six-month period. With the current economic climate and new research performed by EY, the weight of financial commitments is now at the forefront of people’s minds, as a result employers are exploring ways to alleviate the financial pressures currently felt by many.

 

What is flexible pay?

Flexible pay is a new concept whereby employees are paid with an on-demand option. This means if the employee requires their pay early, they can call their earnings to date to fulfil their financial needs removing pressures.

Flexible pay provides an on-demand solution to overcome financial difficulties without the need to ask for an advance from the employer which, in itself, is a daunting task. Flexible pay provides employees with on-demand access to their salary without cause to provide reasoning to why they need access to their salary early.

 

What employees needs it can address

In a study performed by EY, 73% of UK workers find it a challenging to meet everyday expenses or worry about not being able to meet them. In the report EY found 58% of people who have experienced financial difficulties have also reported a material deterioration in their health and wellbeing. Additional pressure stemming from financial difficult can cause mental health issues if long term strain of finances is not addressed.  The stresses associated with these financial burdens can impact other aspects of people’s lives from health and mental wellbeing to work life and personal life.

Flexible pay provides employees with a solution that does not result in additional borrowing and interest associated with borrowing.

 

The benefits it can generate for employers

Flexible pay is a solution that benefits the employer as well as the employee in several ways.

  • Cash flow neutral option for employers
    • Unlike other benefits often provided by employers, flexible pay is a cash flow neutral option. This means employers are not having to factor an upfront payment before the work has taken place.

  • Seen more favourably by employees
    • As with other employee benefits, flexible pay offers the opportunity for employees to look favourably upon their employers. This is a benefit that is designed to help remove a common factor that triggers stress, where work life can also be a contributing factor, flexible pay helps remove stresses outside of the workplace.

  • Attract Talent
    • When recruiting employee benefits can often sway talent to choose to work with a specific employer. Flexible pay demonstrates the employer is not only aware of the employee needs but also shows they are looking to support the employee with benefits designed to provide solutions to employee’s needs whether short or long term.

  • Improve Productivity
    • With many working remotely as a result of the pandemic, mental health and wellbeing has been a focus for employees as it can often impact productivity. By alleviating financial strain that often negatively impacts the employee’s mental health and in turn, their productivity the employer helps prevent their employee’s productivity from being affected.

 

How to roll it out in your business

Part of the challenge when introducing new benefits to employees is how to integrate it within the business. With flexible payment it requires set-up, training and rolling out to employees.

 

So what are the initial requirements?

  1. Flexible pay requires integration with the employer’s payroll system to enable a proportion of the employee’s salary to be available to call upon at the rate it is accrued.

  2. Employees will be required to measure the time worked; this could be through some form of a timesheet to record what has been worked when. This measurement will help calculate the accrued earning.

If payroll is performed in-house, training your finance team is vital to ensure only the salary accrued is available to the employee and any changes to payroll processing processes with particular attention to your payroll software. Training will need to focus on how employee accrued salary data is collected and processed as part of your payroll solution whether outsourced or not. 

Once the changes to your payroll is available to your employees it is important to educate them on what it means for them, what is changing for their payroll and, of course, how they can use flexible pay to call their salary early if need be.

 

IRIS FMP UK is an international payroll solutions provider that is able to offer bespoke payment solutions to businesses to reflect the employer and employee needs including flexible payment options. We are supporting thousands of international and UK based SME organisations. With over 40 years’ experience, we are committed to providing our clients with the very best service, offering transparency, reliability and honesty.

ArticlesFundsFunds of Funds

Conister Reports Record Lending

  • 2020 lending totals £131 million, surpassing 2019 by 7%

  • Conister has also received an additional allocation of £5 million from the British Business Bank to focus on resilient businesses seeking funding

  • Conister has lent £9 million through the British Business Bank’s BBLS

Conister Finance & Leasing Limited (“Conister”), part of Manx Financial Group PLC (AIM:MFX), today announces that it achieved record lending levels in 2020, by advancing deals totalling £131 million, representing a 7% increase on the total amount lent throughout 2019 (£122 million), by providing critical funding to small and medium sized enterprises (“SME”) as they navigate the economic impact of the COVID-19 pandemic.

The growth in funding facilities can in part be attributed to Conister’s accreditation to various Government backed loan schemes to help support struggling businesses in the wake of the COVID-19 pandemic. Through the Coronavirus Business Interruption Loan Scheme (“CBILS”), Conister has advanced £9 million in vital funding across 35 loans and recently announced that it had applied for and received an additional allocation of £5 million to focus on resilient businesses still seeking funding.

Conister has consistently supported the Government’s financial assistance for UK businesses which it believes has been a crucial lifeline to many. In addition to the CBILS lending, Conister has advanced a further £9 million across 246 loans through the Bounce Back Loans Scheme (“BBLS”), against an initial allocation limit of £10 million. 

Douglas Grant, Managing Director of Conister, commented: “We must ensure that the financial security of businesses is protected to allow those that are sustainable to flourish in the future. Up to now, the BBLS and CBILS have performed a fundamental role in keeping many SMEs alive and acted as an important triage system to identify and support qualifying businesses needing credit. However, we believe that we have now passed this phase. Unfortunately, we must recognise that many businesses will not survive this pandemic, particularly if provided with an unsustainable debt burden. It is imperative for the future that we now focus on identifying and protecting our most resilient business sectors.”

“At Conister we have delivered upon all of our initial objectives. We had an allocation limit of £20 million for the CBILS and BBLS schemes and so far, we have lent £18 million, and we will fully allocate the remaining £2 million in the coming weeks. Without doubt, the scale of applications was enormous and so we applied for and received an additional allocation of £5 million for the CBILS scheme and we will focus lending this to robust business sectors that we believe will thrive in the future. Conister will continue to do all it can, working alongside Government and traditional lenders, to support British businesses.”

Jo Dyer, Portfolio Business Manager at First Business Securities, a recipient of a BBLS loan facility through Conister, said: “Conister showed the support and leadership we needed when we first received an increase in requests for payment holidays in April, leading to an ever more likely cash-flow problem. We were impressed with their speed and efficiency and their service won’t be forgotten in future.”

APR
ArticlesBankingCash Management

68% of Credit Card Holders Don’t Know What An APR is and Why This Is Costing Them Money

APR

Key findings:
•69% of people, overall, could not correctly define what an APR is an what it’s used for.

•68% of credit card holders do not know what an APR is.

•66% of mortgage holders do not know what an APR is.

According to KIS Finance’s financial survey, only 31% of adults in the UK could correctly identify what an APR (Annual Percentage Rate) is, including its purpose and how it should be used.

Even more worryingly – a massive 68% of credit card holders don’t know what an APR is, bearing in mind that the APR is undoubtedly one of the most important factors when comparing unsecured financial products like credit cards and personal loans.

The two most common believed definitions of APR were:

•The interest rate alone, without any fees or costs

•The maximum amount that a lender is allowed to charge


How do the figures look when split by age group?

Percentage of people in each age group who could not correctly define what an APR is:

18 – 24: 87.5%
25 – 34: 63%
35 – 44: 77%
45 – 54: 71%
55 – 64: 60%
65+: 73%

 

Only 12.5% of those aged between 18 and 24 know what an APR is

The lack of basic financial knowledge in the 18 to 24 age group is worrying. Having a basic understanding of everyday financial terminology, plus general money and debt management, is an essential life skill.

This leads to the question of whether more financial education should be taught in schools as a key life skill.

Financial education was introduced to the UK’s National Curriculum in 2014, however, findings from The London Institute of Banking & Finance’s Young Persons’ Money Index 2019 backs up our data as it revealed that students still say they are not getting enough access to financial education and they worry about money. Only 17% of students said they had access to financial education within the last year, and just 4% are taught financial education as a separate subject.

Holly Andrews, Managing Director of KIS Finance says:

“Financial education is clearly needed based on these recent findings and financial advisors must take steps to ensure applicants do have a clear understanding of the commitment they are entering in to.

We have long been an advocate of these, and other similar matters, being covered as part of the high school curriculum to ensure everyone has this knowledge when they leave school. From the age of 18, people will be offered unsecured borrowing and it’s essential that they understand all the key points of what they are taking on.”

 

The largest group of credit card holders struggle to define what an APR is

Another main concern is that 60% of 55-64 year olds couldn’t say what an APR is. And according to KIS Finance’s survey, this is the age group with the largest percentage of people who currently have a credit card. Given the often high costs associated with credit cards, it’s worrying that so many people are not aware of the right way to make sure they’re getting the best deal.

 

So, why is it important to understand APRs?

Holly Andrews continues to describe the importance of understanding APRs and the dangers of not doing so.

“Whenever you apply for an unsecured personal loan or credit card you will be quoted the APR. This is very important to understand because the APR tells you what the lender will charge you for borrowing the money over a one year period.

The APR takes into account the interest charges plus any other fees or costs charged in setting up the loan. The APR therefore represents the ‘true price’ of your loan.

The APR is essential for you to be able to plan exactly how much you will have to repay on a loan or credit card. Credit cards are a little different however as you’re only charged interest if you don’t repay the balance in full every month.

APRs are a very useful tool for comparing financial products on a like-for-like basis and will allow you to make more informed decisions. It can be tempting to simply go for the product with the lowest interest rate, but the APR will give you a better idea of what the loan will cost overall.

Even if the interest rate is higher on one product, if the APR is lower, this will be the more cost effective option over the course of a year.

The findings of this survey are worrying because the majority of people cannot be choosing the cheapest products, and those working in the finance industry use the term ‘APR’ freely assuming it’s well understood.

 

What is a representative or typical APR?

“It’s also important to understand the difference between representative APRs and the actual APR you’ll be charged. Lenders can’t show an exact figure for what you’ll be charged on a product without knowing your individual financial circumstances, so on promotional content they will display a ‘representative’ or ‘typical’ APR.

The ‘representative’ or ‘typical’ APR is the rate that at least 51% of the company’s customers must be able to obtain for the finance facility being advertised. Companies can’t advertise APRs that barely anyone can qualify for. You may not be in this 51%, that’s why you may be charged a different rate when it comes to actually applying for the product and after the lender has looked at your credit history and your current financial situation. This could mean that the rate you actually receive may be higher or lower than the one advertised.”

 

What are the dangers of not understanding APRs?

“If you don’t understand what the APR is on the financial products you’re taking out, you could end up being charged a lot more than you were expecting or budgeting for. If this is the case and you can’t meet the required repayments on your loan or credit card, you could see yourself winding up in a lot of debt and seriously damaging your credit rating. Not to mention the stress that being in debt can cause, so making sure you understand the true cost of borrowing is really important to make sure you get the best deal possible, and you don’t wind up over committing yourself financially.”

Home insurance
ArticlesInsuranceRisk Management

How to Secure a Cheaper UK Home Insurance Policy

Home insurance

 

The cost of home insurance in general is quite high in the United Kingdom, especially if you live in one of the major cities like London, Oxford or Winchester among others. There is, of course, a direct correlation between the average cost of home insurance and that of the local real estate in any area, so we are not likely to see home insurance costs coming down significantly anytime soon. If anything, all trends point towards both home and health insurance becoming even more expensive in 2021.

But despite that fact, there is still an opportunity for homeowners to save money on their insurance premiums, as long as they know how to cut costs without cutting the necessary benefits. Here are a few tips that should help.

 

Don’t Trust Any Insurance Agent Blindly

This is a difficult task because insurance agents are convincing professionals who will be looking to sell you the best deal that they can. It’s a “best deal” scenario for the agents and their employers, but not quite for the customers in most situations! This is not to say that every insurance agent will always try to upsell, but that is a very likely scenario, given that it’s their job to do so.

Every insurance agent works for an insurer and they have targets to meet. Therefore, there is no possible way that an agent will help you find the best home insurance deal across all insurance companies in the UK. At best, an honest agent will guide you in finding a good policy from their company, which could suit your needs quite well. That is not exactly a bad deal either, but it’s nowhere close to the kind of money you could be saving by comparing quotes from separate insurance companies.

So, don’t just listen to agents blindly, but compare home insurance online first with a site like Quotezone.co.uk. This is a neutral platform that anyone can use for an unbiased home insurance comparison. You will receive quick quotes from multiple insurance companies simultaneously, and will then be able to compare the quotes side-by-side. They help homeowners find the best possible deal, by letting customers use the competition between top home insurers in the UK.

 

See If a Combined Policy isn’t Cheaper

Home insurance policies are often divided into insurance for the structure/building (house, apartment, etc.) and insurance for the contents within that insured building. Combined policies are usually cheaper, because you will be getting both building insurance and content insurance from the same company. The homeowner will still need to compare their quotes online to find the very best deal, but combined policies are almost always cheaper than insuring the building and its contents separately.

Do be careful in ensuring that the policy doesn’t ultimately end up adding unnecessary for optional extras you don’t actually need, though.

 

Make a List of the Coverage Your Home Insurance Policy Should Have

There are several advantages to having a list which clearly highlights all your home insurance needs. It will make it easier for you to:

  • Prioritise what you need the most, instead of being swayed by an agent’s own interests
  • Find policies that cover most of those benefits within the base plan
  • Find policies that cost the lowest after adding benefits which you must, if applicable
  • Compare home insurance policies online with better results, based on the previously mentioned steps

 

Avoid Paying Unnecessary Interest on Your Premiums

Monthly, bimonthly or quarterly home insurance plans will almost always cost more than if you pay annually or biannually instead. This is because insurers will charge anything between 5% and 10% interest on the total premium when you opt for a payment plan.

If you own property in a prime location, not insuring your home is a very bad idea. There is a high chance that it will eventually cost you a lot more if you decide to skip home insurance altogether. Besides, as long as you manage to use the tips we just discussed, your insurance policy won’t feel so financially draining anymore. If you already have an ongoing policy that is putting a strain on your finances, start looking for other options so that you can shift to a cheaper and better policy as soon as the current contract comes to an end.

cryptocurrency
ArticlesFinanceFunds

Examining the Pros of Stablecoins

Stablecoins are a form of cryptocurrency that differs in one key way to the likes of Bitcoin and Ethereum – they’re stable, hence the name. Rather than experiencing volatility on the markets, those who purchase stablecoins can relax knowing that their investment won’t fluctuate in price. This makes them beneficial for not just individuals, but businesses that accept cryptocurrency as well.

The main type of stablecoin that we are going to look at in this article is centralized stablecoins. These are backed by fiat currencies 1:1 and so you often see them referred to with the currency next to their name – for example USDT (Tether) and GUSD (Gemini USD). The reason they are classed as centralized is because they are backed by a central organization, such as a government, a bank, or a company.

Let’s take a look at some of the benefits of centralized stablecoins.

 

Easy to Purchase

Opting to buy USDT and other stablecoins is very easy, and can be done by anyone with an internet connection. Platforms like Paxful make it easy for anyone to sign up, open a wallet, and buy USDT in whatever amount they want. You can purchase stablecoins using your debit card, PayPal, gift cards, credit cards, Western Union and more. It has never been as easy as it is today to get started.

 

Allows You to Use Fiat Like Crypto

When most people get started with cryptocurrencies, they can find it hard to understand just how much of a particular cryptocurrency they’re getting for their dollar. However, because stablecoins are pegged to a Fiat currency, it’s not quite so difficult to understand. Looking at Tether again, we can see that one USD equals one USDT. Tether experiences the exact same price movements as the USD, making it easier to understand and invest in.

 

Low Fees

Because of the peer-to-peer nature of stablecoins, and the lack of intermediaries, transactions tend to be a lot cheaper than with traditional finance. Credit card payments and bank transfers, for example, both charge a fee and commission, which can be exceedingly high when transferred abroad. This is not the case with stablecoins. Also, as mentioned above, due to them being pegged to a Fiat currency, it’s possible to transfer your USD to USDT, transfer the USDT to a friend, and then have them transfer it back to USD to save on transaction fees.

 

They’re Not Volatile

The main advantage of stablecoins over other types of cryptocurrency is that they’re not affected by the same price fluctuations. This is something that is crucial if the world is going to accept cryptocurrencies in the mainstream. No-one wants to accept payment for something, or receive their paycheck, without stability as the amount they receive could change dramatically from day to day. Due to their nature, stablecoins are helping to overcome many of the challenges faced by traditional cryptocurrencies like Bitcoin and Ethereum, which will only help to encourage the spread.

As you can see, stablecoins have a clear place in the economy. It will be interesting to see if they ever replace Fiat currency in the future.

Synergy Quantum
Articles

Synergy Quantum: Most Innovative HNWI Technology Firm, Europe – 2020

Synergy Quantum is the technology brand of Synergy Asset Management. It was born to address one of the most prominent concerns of the world’s wealthiest families: THEIR PRIVACY

To ensure safety and wellbeing of its clients, SYNERGY QUANTUM has been developing QUARTZ, an exclusive tool to shield, protect and control all sensitive data and communication of HNWIs.

Quartz is a suite of digital tools that SECURE ALL PRIVATE DIGITAL DATA AND COMMUNICATION of HNWI with post-quantum cryptography in the safety of the Swiss mountains.

Synergy Quantum intends to deliver the most premium, secure and integrated digital experience to guarantee complete control, protection and privacy of HNWI’S data and communication.

 

Synergy Quantum

Contact Information:
Website: https://www.synergyquantum.swiss/

Co-operative bank
ArticlesBankingCash Management

The Co-operative Renews Support of The Hive, As Part of Its Ongoing Commitment to the UK’s Co-operative Businesses

Co-operative bank
  • The Co-operative Bank has committed an additional £400,000 to support The Hive – a programme to help new and existing co-operatives delivered by Co-operatives UK

  • The Co-operative Bank’s customer-led Ethical Policy outlines its commitment to nurture and support the co-operative sector, having previously invested £1.3 million in this programme since 2016

  • Rose Marley, Co-operatives UK’s new CEO anticipates ‘a new wave of entrepreneurs responding to a need to do things differently’

The Co-operative Bank has announced it has renewed its partnership with The Hive, a support programme for the UK’s co-operatives, delivered by Co-operatives UK.

The Hive, which The Co-operative Bank has supported with a total investment of £1.7 million since 2016, has helped over 1,000 co-operatives and groups with support including direct business advice, workshops, training and mentoring. Part of the funding from The Co-operative Bank has also helped develop a digital registration service for co-op start-ups – a first for the sector. As part of this process, new co-ops will also be able to access free business banking from The Co-operative Bank.

Since the launch of The Hive in 2016 some of the key achievements over the last four years include:

  • Over 1,000 groups have received support worth in excess of £600,000.

  • 50 free introductory sessions facilitated across the UK, attended by more than 500 groups, looking to start a co-operative or wanting to learn more.

  • Over 80 new co-operatives have been incorporated.

  • 40 ‘Community Shares’ support packages provided, raising more than £6 million of community investment in the development of co-operatives and their communities

  • The support has impacted more than 20,000 volunteers, members and employees as well as their wider communities.

  • Supporting co-ops throughout Covid-19, helping them navigate the various business support schemes, working through business forecasting and cost saving opportunities and helping businesses ‘pivot’ to online trading.

This news follows Co-operatives UK research which suggested co-operatives may be far more resilient to economic shocks and significantly more likely to survive compared with other businesses. After their first five years, 76% of co-operatives are more likely to succeed when compared with other businesses (42%). Co-operatives contribute £38 billion to the UK economy and the UK’s 7,063 independent co-ops employ 241,714 people with over 14 million members who own and have a say in how they operate.

Nick Slape, Chief Executive Officer, The Co-operative Bank said “As a bank built on co-operative values and ethics we remain committed to supporting the co-operative sector, giving like-minded people, innovators and groups the support they need to succeed when UK businesses face unprecedented challenges during this extremely difficult time. We hope that through our ongoing support of The Hive and partnership with Co-operatives UK, we can make a real difference to people running or looking to start a co-operative.”

Rose Marley, Chief Executive, Co-operatives UK said “The pandemic has really made people think about their business and working lives. As more and more people are looking at how they might improve their future working lives for themselves, their families and the communities they are based in, we are delighted that The Co-operative Bank is supporting new and existing co-operatives to do just this.

“Our research demonstrates that co-operatives are almost twice as likely to survive the early years of business compared to traditional business models, and workers are looking for fairer and more equitable ways to do business and challenge the status quo.

“Leeds Bread Co-op is a brilliant example of how The Hive has supported businesses through the pandemic. And with continued support from The Co-operative Bank, The Hive will continue to create more robust and resilient business that will make a real difference to the communities they are rooted in.”

Leeds Bread Co-op is an independent artisan bakery and workers’ co-operative. They received support from The Hive to help them adapt in the wake of the Covid-19 pandemic.

Lizzie, a Worker Owner at Leeds Bread Co-op said “We had a massive drop in sales from our wholesale customers who had to close because of government restrictions in the spring. We decided to cease trading temporarily for the safety of our staff and local community and to give ourselves some breathing space whilst we worked with an advisor from The Hive on urgent financial modelling and collective decision-making about our priorities. This was in addition to financial support from The Co-operative Bank as part of the Bounce Back Loans Scheme (BBLS). We’re now back open, with social distancing measures in place as well as a new click and collect service and home deliveries, meaning we can still continue to trade in these challenging times. Support from the Hive was a lifeline at a critical time.”

In addition to supporting co-operatives through The Hive, The Co-operative Bank also provides tailored accounts specifically for community and co-operative businesses. The Community Directplus Current Account gives registered charities, community interest companies, co-operatives and credit unions an ethical way to bank for free. Community Directplus customers also have the opportunity to apply for up to £1,000 for project funding from the Co-operative Bank’s Customer Donation Fund which helps support special projects and fundraising opportunities.

Trading app
ArticlesBankingFX and PaymentSecurities

PixelPlex Shares Details of Its New Crypto Arbitrage Platform

Trading app

 

PixelPlex, a global provider of blockchain-powered solutions, has announced the successful launch of a crypto arbitrage platform. The new application is designed to provide cryptocurrency traders with an effective tool with which they can grab the most beneficial deal.
PixelPlex developers have pointed out that one of the most important features of their platform is the built-in arbitrage bot, as it does crypto trading itself and helps users to make a profit.

The engineering team has also explained how it works. The bot simultaneously buys and sells the same amount of bitcoins (or any other cryptocurrency) from two different exchanges. Meanwhile, their equivalent amount in fiat is different, so the trader makes money on the difference in currency rates.

The PixelPlex bitcoin trading platform contains a data collection mechanism, an algorithm for finding profitable deals, a tool for handling cryptocurrency volatility, and the ability to exchange cryptocurrencies for fiat money and vice versa.

The company’s team of experts have commented on more details of their solution. They have mentioned several major risks usually associated with crypto arbitrage, such as a halt in trading caused by the accumulation of all funds on one exchange and high transaction fees that lead to zero profit or even financial losses. To prevent and eliminate these issues, a graph theory-based optimal search algorithm was developed.

The algorithm receives data from leading exchanges like Binance, Bittrex, Kraken, and others, then it selects the best trading deal and executes the transaction before the market changes and the trader passes the opportunity.

As noted by PixelPlex, their platform is capable of making instant decisions, thereby allowing traders to rest and check their account balance once in a while. They claim that their arbitrage software includes all the features every trader needs: the ability to set thresholds for trades and profits, trade directly or through a minor pair, and access investment strategies that are typically not available when using conventional methods.

Another feature that may not be immediately noticeable, but equally important, is the intuitive user interface. The PixelPlex designers and developers have placed opening and closing deals buttons a few clicks apart and included a built-in set of options to let users customize the solution. Copy-trading and all the information in the app are presented in graphs and charts.

In the end, PixelPlex representatives have noted that their crypto arbitrage solution is easy to integrate and carry over to any business environment.

Digital Banking
ArticlesBanking

Over a Quarter of Brits Now Have an Account with a Digital-Only Bank

Digital Banking
  • The number of Brits with a digital-only bank account has gone up by a percentage increase of 16% 

  • Almost 1 in 6 Brits (17%) plan to open a digital bank account over the next 5 years

  • The top reason for opening an account was the convenience of banking online for the third year running

  • However, 16% of traditional banking customers who aren’t planning to switch said their bank had been helpful during the COVID pandemic

Currently over a quarter of Brits (27%) say they have at least one bank account with a digital-only bank, according to personal finance comparison site finder.com.

This is a percentage increase of 16% from last year when 23% of Brits said they had an account with a digital bank. It is also over 3 times the amount of Brits who had one in January 2019 (9%).

Finder’s 2019 research found that 24% of Brits intended to have a digital-only account by 2024. However with 27% now having an account, Brits have gone digital 3 years earlier than expected.

A further 17% of Brits intend to join them over the next 5 years, with 11% planning to do so over the next year. This could mean that 44% of Brits could have an account with a digital bank by 2026. If this percentage were applied to the UK adult population, it would equal almost 23 million people.

The top reason for opening an account continues to be convenience that digital-only banks provide, for the third year running (26%). The second most common reason was that users needed an additional account and setting up a digital account seemed to be the easiest option (20%). Customers also wanted to transfer money more easily (19%), making this the third biggest priority.

People wanting a trendy card is still driving signups as well, with 1 in 10 (10%) existing, or future, customers citing this as a reason to get an account.

Despite the increase in digital-only banking customers, the numbers who aren’t considering one have actually risen. Last year, 23% of respondents said they aren’t considering a digital-only bank account, but this has risen substantially to 42% in the latest survey. 

This is likely a result of increased customer loyalty, 58% of those without a digital bank account said they felt as though their incumbent bank had treated them well and therefore had no desire to open a digital bank account. Additionally, 16% felt as though their incumbent bank had performed particularly well during the pandemic. 

Over a third (36%) of those without a digital bank account said they had not decided to bank with digital providers because they preferred to be able to speak to someone in branch. 

Digital banks are still most popular with younger generations, 46% of gen Z say they currently have a digital bank account, with a further 28% intending to get one over the next 5 years. This would mean that by 2026 just under three quarters of gen Z (73%) could have a digital bank account. 

Commenting on the findings, Matt Boyle, banking specialist  at finder.com said: 

“This research shows that digital-only banks are here to stay, with the number of users in the UK rising for 3 years straight. On top of this, Starling and Revolut announced this year that they have made a profit for the first time, really demonstrating that digital banks are starting to become a serious part of the banking furniture. 

“The pandemic has also played a role in the rapid digitalisation of the banking industry, with those who had never experienced online banking having no other choice but to take their finances online. It seems that Brits are starting to realise the convenience that can come with digital banking and this is reflected in our research.”

To see the research in full visit: https://www.finder.com/uk/digital-banking-adoption

Successful Business
ArticlesDue DiligenceRisk Management

Your Business Is Successful: What To Do Next

Successful Business

In the world of business, huge triumphs are hard fought for.

Therefore, it’s important that you don’t squander all that your entrepreneurial journey has meant to you so far. While it can be incredibly difficult to reap any rewards from your own venture, it’s almost just as difficult to retain your success in the days ahead. A balanced, rational approach is undoubtedly needed.

Success is not the end of your journey, but a new beginning. Here’s a few ideas on what to do next.

 

Remain Rational

Even if your finances have undergone a radical makeover in recent times, it’s still important to be level-headed.

In October 2018, The Guardian reported on an American entrepreneur who made millions in commercial radio, but lost it all after falling victim to a textbook investment scam that could have easily been avoided. He died broke. Obviously, there’s a lesson to be learned here.

It’s easy to feel like you’re invincible after success has come your way. However, success can be a fickle thing and provide a false sense of security. No one is above human error and the occasional bout of poor judgement. So, invest by all means, but do so via legitimate channels for a strategic gain, and keep your wits about you.

 

Reward Yourself Smartly

Just as it is easy to fall prey to dodgy investment schemes, its also possible to spend in excess and waste your money via your own volition.

There are people in the world who would claw tooth and nail for a tiny fraction of what you have, so it’s important to not only enjoy your success, but to respect it also. That means utilising it wisely and enjoying the fruits of your labours in a controlled, strategic, and smart fashion.

If you want to dabble in high-end property, for example, then consult million-pound mortgage experts. The dedicated brokers of Ennes Global negotiate the best possible lending terms, and endeavour to provide all their clients with a smooth, clean transaction experience. Answering questions, running calculations, and providing strong advice – it’s all their bread and butter. Every investment you make that’s backed by their services is guaranteed to be a good one.

 

Find the Pattern

Congratulations, you’re successful! Now things need to stay that way.

Coronavirus has widely been reported to be the bane of businesses the world over. However, it’s undeniable that some industries have thrived despite all the doom and gloom. Online retailers, fast food services, and delivery companies have all seen a huge uptick in their productivity and profits. Of course, there’s also the real chance the boom won’t last when the crisis is abated.

Find the pulse of your success as soon as it arrives and ascertain whether it’s a temporary bit of fortune or the product of a real, recurring strategy of your own making. Many businesses ebb and flow, sometimes not staying at the pinnacle of their potential for long, so it’s important to identify exactly what is going right in your firm and sticking to whatever is working like glue.

It’s also important to plan for when outside circumstances like pandemics, the economy, and shopping trends might change. What then? Keep an eye on the future, and make sure your business is flexible enough that it isn’t a one trick pony. That way, things won’t collapse the moment the wind changes, because while firms can experience a huge surge in profits, they can crash into oblivion just as hard also.  

Approved
ArticlesFinance

How to get Approved for Finance

Approved


Applying and then being rejected for equipment finance or loans for your business can be disappointing and frustrating, not to mention time consuming, even more so in the current climate. This is why we are encouraging our businesses to follow the correct process and work with us to process their applications efficiently and have a better chance of securing the best deal possible.

It’s safe to say that lenders do not need an excuse to turn down applications, which means your application needs to tick every box, cross every ‘t’ and dot every ‘i’, in order to give you the best possible chance. Our job is to help you, so here are some of our top tips on how to get approved for finance.

 

Have a target outcome in mind

Lenders will either provide finance for your equipment, to help support your business and its operations, selling to customers, such as a frying range for a chip shop, oven for a restaurant or squat rack for a gym. However, you may require a business loan, which may support your business by helping to invest in equipment, stabilise cash flow as well as giving you money for a rainy day. By establishing which of these two target outcomes is suitable for you and your business, you can ensure you get the right finance for the right reasons, giving your business the best time of investment.

 

Get the right equipment

Most lenders prefer equipment in a good condition from a recognised supplier, such as those we work with at Johnson Reed. The finance for your equipment will be secured against the value of the asset, therefore the working condition, type and origin of the equipment will help to reassure the lender that it can help your business, whether its use is directly or indirectly connected to turnover, in order to be sure your business can repay the finance. This gives the lender confidence in your business and the investment.

 

Have a rationale

Your business is more likely to be accepted for finance if you have a clear rationale or business plan for the purchase. By answering the following questions:

What is the finance for?

How will it be used?

How will it benefit your business

How will it help you generate turnover?

the lender will be able to clearly see the plan for the business, how it can generate revenue using the finance, giving confidence to the lender to accept your rationale and confidence that you can make repayments. Being prepared and knowing your business inside out, as of course you do, is exactly how you can you can boost your chances to secure that all important investment for your business.

 

Check your credit score and documents

By having your credit score in order (we use Experian), with updated history, addresses, details and information, as well as any documents ready-to-hand. Having information and documents such as bank statements, accounts, ID and rationale for investment can all help to ensure your application is processed quickly and efficiently, without delays or hesitation from the lender.

 

Think like an underwriter

You need to install confidence in underwriters when applying for finance. They are paid to assess your application by scrutinising every aspect of it, to establish whether there are any doubts about you or your business, and its ability to succeed in repaying the finance that you need. Therefore, it makes sense to think like one, try and visualise what they are thinking when processing your application. Are you presenting the best case for your business to be approved? Are you presenting a clear rationale, with up-to-date documents and reasoning behind any questions they have regarding your business? The answer to these questions needs to be ‘yes’ to give your business the best chance.

 

We know how important investing in your business is, and how it has to be done right. This is why we offer hands-on support to our clients in securing their funds, at the best price, because rates matter, to us and to you, when it’s your business.

If you are interested in a business loan, equipment finance or leasing from Johnson Reed, visit our website, drop us a call (0161 429 6949) or an email ([email protected]nsonreed.co.uk).

Finance
ArticlesBankingTransactional and Investment Banking

2021’s Major Investment Risks – But Why it Could Be a Year of Massive Opportunity

Finance

Investment headwinds will “still exceed the tailwinds” in 2021 – but there could be more “major opportunities now than in perhaps the last 10 years” if you know where to look.
 
This is the bold and, given 2020, perhaps surprisingly optimistic forecast from Nigel Green, chief executive and founder of deVere Group, one of the world’s largest independent financial advisory and fintech organisations.
 
It comes as investors around the world focus on rebalancing portfolios for 2021, after a year no-one expected.
 
Mr Green says: “2020 was a year for which nobody had planned.
 
“This included investors, many of whom were caught spectacularly off-guard by not having properly diversified portfolios, which left them open to untold financial risks.
 
“Looking ahead to 2021, it is likely that investment headwinds will still exceed the tailwinds – but, I believe, that there are also more major investment opportunities to be had in the next year than perhaps in the last decade.”
 
‘Headwinds’ are the factors that likely weigh on growth and returns, and ‘tailwinds’ are those that can be expected to boost growth and help drive positive returns.
 
He continues: “The major long-term headwind from the fallout of 2020 is unemployment, which will hit demand, growth and investment.
 
“There’s also the roll-out of a mass global vaccination agenda which will be a lengthy process and logistical minefield, plus there are the ‘vaccine sceptic’ concerns to address.
 
“Meanwhile there are geopolitical issues that could impact on investor returns. These include the significant readjustment that will need to happen following Brexit, U.S.-China trade relations which are likely to become increasingly competitive especially in the tech sector, and the rising border tensions between India and China, amongst others.”
 
However, despite the significant headwinds, the deVere CEO flags three major investment tailwinds in 2021.
 
“First, the rollout of the Covid vaccines which means economies can be expected to begin solid recoveries,” he says.
 
“Second, President-elect Joe Biden will enter office and his administration promises a more predictable approach to trade and foreign affairs – and the markets like certainty.
 
“And third, it is likely that governments will continue to offer fiscal support packages as their economies recover from the pandemic, offering a ‘floor’ for markets.”
 
Mr Green goes on to add: “To quote Einstein, ‘In the midst of every crisis, lies great opportunity.’
 
“This is why, after such a monumental crisis, I believe that if you know where to look and act appropriately to build your wealth, there could be plenty of key opportunities to come.
 
“The pandemic has accelerated history, speeding up and exacerbating major trends in just a few months, that ordinarily might have taken decades to be fully realised.”
 
He maintains that the global economy, how we live, do business and interact remains fundamentally changed.  “It is doubtful the world will go back exactly to how it was pre-Covid – there are many aspects of the ‘new normal’ which people like and support, just a home working.  As such, some of the major shifts are unlikely to be reversed,” he notes.
  
“As such, investors need to look for the lower entry points of quality companies to top-up their portfolios and, critically, they need to bear in mind how the world has changed. 

“Their portfolios must reflect the future, not the past.”
 
Mr Green concludes: “Headwinds will surpass tailwinds in 2021 as the world readjusts, but it’s essential that investors stay invested. As we know, history has shown us that stock markets tend to go up over the long-term.
 
“But as the world moves ahead to a post-pandemic era, it’s crucial that investors ensure their portfolios are suitably diversified across asset classes, sectors, currencies and regions, so as to make the most of the considerable opportunities that will inevitably present themselves.”

Finance Management
ArticlesFunds

Beating the City – Could it Pay to be Your Own Fund Manager

Finance Management

By Ben Hobson, Markets Editor, Stockopedia 

For investors, it’s an incredibly unsettling time. Uncertainty continues to sweep the stock market and it’s anyone’s guess just how far the economic impact of coronavirus will spread. 

Some sectors have been sucker-punched by the crisis, such as airlines, leisure and travel. In a few cases, companies are facing a battle for survival. 

However, you can beat the City with a little know how. 

Ben Hobson, Markets Editor at Stockopedia explains why now might be the perfect time to break free and run your own investment portfolio.

 

Keep your costs down 

Ideally, you want to keep the annual costs of running your own portfolio below 2.5% to beat the cost of owning a fund. 

Fund expense ratios are often listed very appealingly at, for example, 0.75%, but this often fails to take into account a layer of hidden fees and transaction costs that can easily take the true cost of investing in a fund up to and beyond 2.5% or even as much as 4% annually. 

Diversification can deliver higher returns and buffer against market downturns, but you don’t need upwards of 100 stocks to benefit, like in many mutual funds. After all, as the number of stocks you own increases, so do the costs of rebalancing the portfolio. 

The optimal level of diversification for a portfolio is arguable, but some luminaries have argued that you only need 6-8 stocks to get the lion’s share of diversification benefits. Research shows that 15 stocks in a portfolio can give 87% of the benefits of full diversification. 

From our own analysis, it starts to pay to be your own fund manager when you’ve got £25k to invest or more – but even trading smaller sums can provide valuable experience as you build your portfolio. 

 

Give every stock a role  

Try and take a more portfolio-based approach and think about your overall strategy. That means worrying less about individual stocks (narrow framing) and seeing the bigger, long-term picture. 

Narrow framing is when you make decisions without thinking about their wider impact, like the effect of a stock purchase on your portfolio. This can lead to all sorts of potentially costly mistakes and could mean your portfolio becomes over-laden with stocks that all have similar characteristics, leaving you over-exposed. 

Instead, give every stock a role that serves the rest of the portfolio. That mix might include large-cap blue-chips, small-cap growth plays, fast-moving cyclicals and perhaps some dependable defensives. And follow a firm strategy and fight the instincts of selling winners and holding losers. 

 

Resist the urge to react  

Fund managers are well trained to keep a level head. After all, it isn’t their money they’re winning or losing. 

Being your own fund manager is a time-consuming activity and with your own money at stake, it’s easy to become oversensitive to market movements.  

However, checking your portfolio too much or becoming emotionally wrapped up in day-to-day market shifts means you’ll be likely to miss the opportunity to reap the rewards of holding on for an uptick in value. Don’t forget that each trade  costs you in fees, which can add up over time and eat away at returns.  

To anchor your thought processes and protect against that urge to react instantly to market movements, make sure you build and refine your own investment strategy, then apply it consistently across your portfolio.  

 

Time to go global 

Home bias can increase risk and cost money in terms of missed opportunities.  

It’s never been easier to go global with your investments, with electronic markets and masses of company information available at your fingertips, so if you’re managing your own portfolio there really is no excuse not to look further afield for the best investments.. 

Investing is always risky and prudence is required when dealing in unfamiliar markets – but exercising caution and demanding a margin of safety is always good practice regardless of where you are investing . 

One way of partially addressing this concern is to rule out developing markets (or use ETFs) and focus instead on the big, global indexes. 

You can also mitigate concerns around a lack of knowledge of overseas markets by sticking to systematic, factor-based investing methods. This approach analyses a share’s core fundamentals – like value, quality and momentum – over time to project future rises or dips in value, which can help to minimise the risks of behavioural biases and knowledge gaps. 

Crypto currency
ArticlesFinance

3 Signs That Crypto Is Going Mainstream

Crypto currency

 

This Bitcoin bull run is different from 2017’s because cryptocurrency is showing all the signs of going mainstream in the next couple of years

For a long time, cryptocurrency was the preserve of a small group of tech enthusiasts and hardcore libertarians. This began to change in 2017 when Bitcoin hit staggering heights and the front pages of most newspapers. After the great crash of 2018, however, Bitcoin and other cryptocurrencies dropped off the radar of mainstream consciousness.

Bitcoin was still a popular asset but primarily one for savvy individuals trading on exchanges and consumers making derivatives bets via smartphone apps. But the latter half of 2020 saw a change. Today, all the signs point to crypto going mainstream and becoming part of our daily lives.

 

1. The PayPal Effect

With over 305 million active accounts and a merchant network of 22 million, PayPal has a large reach. This is why the company’s bombshell announcement that it would start allowing users to buy, and more importantly spend, cryptocurrency was so big. Users would be locked into PayPal’s network, which will not be enough for crypto purists. But it provides an easier way than ever before for people to buy and sell cryptocurrency.
PayPal’s decision will help to normalize cryptocurrency for large numbers of people and merchants who would never have considered it before. The key is that most people are familiar with how PayPal works. So it provides a frictionless way for merchants to accept crypto payments without being forced to integrate new tools into their e-commerce packages. In other words, it makes cryptocurrency simple.
The decision has come with some limitations. For the moment, it is limited to the United States. And perhaps more important, users will be unable to withdraw cryptocurrency from the PayPal wallet. This means that PayPal is acting as a sort of “crypto gateway,” rather than allowing users to truly own and control their cryptocurrencies.
That being said, the deal is still significant and represents a leap forward in crypto education and acceptance.

 

2. Institutional Capital Is Obsessed With Bitcoin

The most recent Bitcoin bull run differs from 2017 because it is being fuelled in part by institutional investment capital. Household names in the investment world, including Grayscale, MassMutual, and even Goldman Sachs, have jumped headfirst into the world of cryptocurrency. Indeed Greyscale now has over $19 billion in crypto-assets and that figure looks set to grow.
This rush of investor capital is significant as it represents a “stronger hand” than many of the retail investors currently in cryptocurrency. Many companies that are betting on crypto will be looking to hold their assets for the long term. One of the more ambitious claims was from Microstrategy, which is looking to hold onto its newly acquired BTC for 100 years or more. 
In theory, this capital increases the underlying value of Bitcoin. This effect is compounded because the supply of Bitcoin is capped at 21 million. This means that scarcity will cause an increase in value as demand continues to rise. In the long term, this will lead to other cryptocurrencies being lifted by Bitcon’s rising tide, as investors late to the party seek a better deal with more affordable options.
 

3. A Crypto Ecosystem Is Being Built

The other success story of 2020 is Ethereum, which has grown by more than 455% to $723. This impressive growth has been driven primarily by an explosion in DeFi apps, and the much-anticipated update to Ethereum 2.0.
DeFi apps are designed to mimic real-world financial instruments and have attracted around $14 billion in locked crypto assets. The most popular so far have been lending apps and decentralized exchanges.
The apps work using smart contracts and the vast majority use the ERC20 token protocol. This means they use the Ethereum blockchain. These smart contracts enable decentralized apps to do things like allowing P2P crypto exchanges and lending without the need for a 3rd party adjudicator.
The problem is that each contract functions as a transaction and so needs to be approved by validators on the Ethereum blockchain. The sheer popularity of DeFi apps has led to a significant slowdown in 2020, which some saw as a block on growth. The Ethereum 2.0 update will go some way towards fixing this via a switch to Proof of Stake, which will improve scalability.
If the Ethereum 2.0 update proves to be workable, it could be a bedrock upon which a fully decentralized crypto ecosystem is built. This will enable crypto holders to access financial services without being forced to use fiat currency and could open up a whole new world.

 

Crypto Is Here to Stay

Perhaps the biggest sign that the world is warming up to crypto comes from JPMorgan’s own Jamie Dimon. The famous executive was one of the more vocal voices comparing Bitcoin, and by extension cryptocurrencies generally, to a scam akin to the famous Dutch tulip mania. Now he openly admits that Bitcoin and the technologically underpinning it has potential, but it is simply not his “cup of tea.”
With even staunch skeptics coming around, it’s clear that cryptocurrency is here to stay and you may even find yourself using your own crypto wallet in the near future. If you aren’t already, that is.