All posts by Susannah Griffin

ecommerce
FundsWealth Management

Five Ways To Compete With Bigger ECommerce Stores

ecommerce

Five Ways To Compete With Bigger ECommerce Stores

 

The eCommerce industry is fiercely competitive which can make it difficult to succeed. It is hard to compete with the bigger brands in your industry because they will have the reputation and visibility online to attract new customers, but there are a few key strategies that you can use which will help you to compete at a higher level and both attract and retain customers.

Once you are able to do this, your reputation should skyrocket which only makes it easier to get new customers and become one of the key players in your field.

Here are a few ways that you can compete with the bigger ecommerce stores:

1. Digital Marketing

The first and most important step to take is to increase your marketing efforts. As it is so competitive, this needs to be an area of investment so that you can benefit from greater results. Using SEO and PPC can deliver both long-term and short-term results so that you can immediately increase your visibility and garner more visitors to your store.

2. Improve Customer Service

Even in an online industry, consumers need to feel important and valued but even this is an area that the bigger brands can struggle with. Make sure that you are looking after your customers, responding to queries and complaints swiftly and thanking them for their custom. Additionally, it should be easy for them to contact you whether this is with live chat, on social media, via email or phone.

3. Analyse The Competition

A smart business owner will always keep a close eye on their competitors and learn from them. Identify the strengths and weaknesses of your competitors and find ways to use this information to your advantage to compete at a higher level. You can use reverse image search on your own products to find other stores selling the same item. This will help you to discover who your competitors are and enable you to carry out research.

4. Write Unique Product Descriptions

One area where larger ecommerce stores struggle is with product descriptions, as they often have so many products that they end up using the default description from the manufacturer. Creating unique, detailed descriptions can be effective for converting customers and increasing your visibility online. In addition to unique product descriptions, you could also use augmented reality apps, customer reviews and product videos to give visitors a much better sense of the product.

5. Adjust Pricing

Most consumers will compare products at a few different places before settling on an eCommerce store. Adjusting your pricing could help you to lure customers away from the competition and to your business, and a slight reduction should balance out with the increase in sales. Additionally, you also need to make sure that shipping is affordable as this is the primary reason for abandoned carts.

Hopefully, these tips will help your ecommerce store to start competing at a higher level and attract customers away from the bigger stores. It is fiercely competitive online but if you are intelligent and strategise, then it is possible to find success and challenge the bigger brands.

r&d
Corporate TaxTax

UK engineering companies are potentially missing out on £10 billion of R&D funding each year

r&d

UK engineering companies are potentially missing out on £10 billion of R&D funding each year

 

Engineering companies in the UK are potentially missing out on over £10 billion of R&D funding each year, new research has revealed.

The study, commissioned by innovation specialists MPA for Advanced Engineering 2019, found that one in five (21%) innovation active engineering firms are not taking advantage of the government’s R&D Tax Credit scheme, which allows companies to claim back up to 33p for every £1 spent on R&D activity.(1)

On average, engineering companies invest £386,000 a year on R&D activity, meaning they are potentially able to claim £100,360 in funding.(2) With over 100,000 UK engineering firms not claiming, despite describing their company as innovation active, a staggering £10.2 billion is going unclaimed each year.(3)

Reasons for not claiming the funding vary, but the most common answer given by engineers is that they don’t believe their companies are eligible (10%).

However, the research revealed that many engineering companies probably qualify without them realising. Some examples of indicative qualifying activities are, if your company develops new processes to improve efficiency, quality or performance; overcome unplanned technical difficulties or create bespoke solutions for clients.

Two-thirds (67%) of workers think that their firms are ‘innovation active’, which is the most accurate indicator that a company is eligible for the R&D Tax Credit scheme. Despite this, only a third (37%) say that their companies claim the available funding.

Another barrier blocking engineers from claiming is a lack of awareness about the initiative. Nearly a quarter (24%) of the surveyed engineers who aren’t claiming admitted that they didn’t even know that the scheme exists. Even among those who think they are innovation active, one in fourteen (7%) said that they were completely unaware of R&D tax credits.

While many are yet to take advantage of the scheme, engineering companies in the UK are planning on investing heavily in research and development. Over the next year, over one in five (22%) businesses in the industry are planning on spending over £1 million on innovative projects.

Nigel Urquhart, Senior Technical Analyst at MPA, said: “Engineering companies in the UK are respected all over the world for their quality and innovation, but a worryingly low number of them are claiming the R&D funding they are entitled to.

“Our research has highlighted that more work needs to be done to raise awareness of the R&D Tax Credit scheme, as these innovative companies could save themselves hundreds of thousands of pounds. This money could then be reinvested to fund further innovation, which would ensure UK engineering stays at the forefront of the industry.”

To see whether your company is eligible for the R&D Tax Credit scheme, visit: https://mpa.co.uk/services/rd-tax-credits/

[1] Survey of 250 UK engineers conducted by The Engineer on behalf of MPA in September 2019

[2] R&D tax credits calculator: https://mpa.co.uk/services/rd-tax-credits/

[3] Office for National Statistics: ‘Engineering Industry in the UK’ (December 2018) – there are 721,940 active engineering enterprises in the UK. 485,143 (67%) of these are innovation active. 101,880 (21%) of these innovation active companies are not claiming R&D funding: //www.ons.gov.uk/businessindustryandtrade/business/activitysizeandlocation/adhocs/009383engineeringindustryintheuk

crisps
ArticlesTax

Bras, rum and crisps – just some of the things the government has given tax relief on

crisps

Bras, rum and crisps – just some of the things the government has given tax relief on

 

Organisations of all shapes and sizes can benefit from R&D tax credit, providing tax relief on research and development costs and while you might think the work you’re doing doesn’t qualify, R&D tax credit specialist RIFT Research and Development Ltd has released some of the stranger cases they’ve worked on to highlight just how much of the UK’s output could qualify.

Drone technology for a humanitarian crisis

 

One engineering company set out to address the issue that 40% of vaccinations expire while still in the warehouses before they can be delivered and administered to those in need.

They set out to use drones to deliver medicine to remote regions in order to save money and lives and in doing so, found that the technology required was advanced, needing to include links with existing response solutions, ground controlled computers, autopilots and aerial surveillance.

The project went from a conceptual idea to a built and tested prototype and RIFT identified over £104,000 worth of qualify R&D costs over two claims in two years.

Plus-sized lingerie

One company that qualified for tax relief designs and manufactures plus size lingerie and swimwear, starting at bra size 36D, with the aim to flatter, accentuate and celebrate natural curves.

The founder used to struggle to find larger sized underwear and swimwear that offered the same boudoir appeal to smaller sized undergarments, so they brought garments to market that used high quality materials such as lace, soft satins and chiffon.
The company engaged in research & development to produce high quality, durable, comfortable and supportive bras that come in a range of materials, patterns and sizes.

RIFT identified £55,000 worth of eligible costs over two financial years that qualified for R&D Tax credit.

Guess who – facial recognition technology

The firm in question developed facial recognition software which better identifies forgeries.

The company collated a dataset of copied documents, including photocopied, manipulated, screen modified and superimposed examples.

These were combined with professionally forged documents that had been legitimately acquired to test out the technical uncertainties of the new detection solutions they developed. 

The systems were able to detect real identification documents and flag fakes. They can also verify that the photo within the ID matches the person claiming to own the ID.

RIFT identified over £1.07m of qualifying R&D expenditure in one financial year, even though many of the technologies were still at the prototype stage when the claim was submitted. 

Natural crisp flavours

The company produces crisps using locally sourced ingredients from the South of England which are hand-cooked and free from artificial ingredients. 

The manufacturer identified that few companies exist that make unique flavours of crisps using locally sourced ingredients, so it wanted to experiment with new flavours.  

Through a trial and error process, new ways of flavouring were found and tested with sample groups. 

Technical advances were made and technical uncertainties were resolved by the company with RIFT identifying £101,000 worth of eligible costs across two financial years that qualified for R&D Tax credit. 

Making traditional luggage using new methods

A 200-year-old brand used by Royalty and famous explorers worked on numerous projects to combine Victorian engineering with the latest technology, materials and processes.

The company collaborated with the most prestigious fashion houses and brands to make technologically advanced pieces while retaining that traditional feel.
RIFT identified over £1.037m worth of qualifying R&D costs over three claims covering four financial years.

Boutique Rum

Alternative rum flavours are increasing in popularity and demand, such as spices or coconut.

However, there were no established, open-sourced recipes, which meant that distilleries/fermenters had to develop their own by combining flavours and identifying the correct ingredient quantities, blends and alcohol levels.

The firm in question decided to develop a rum base which would have high quality coffee infused into its 5 year old golden rum.

After various tests and alterations to the recipe following feedback from bartenders and members of the public, the company increased the alcohol and flavour strength to produce a coffee rum liqueur that can be drunk straight or used in a cocktail.

RIFT identified £60,000 worth of eligible costs across two financial years that qualified for a R&D Tax credit.

Technical advances were made and technical uncertainties were resolved by the company in producing a cocktail in a matter of seconds instead of minutes.

Head of RIFT Research and Development Limited, Sarah Collins commented:

“Even though the R&D claim process was launched nearly 20 years ago, the number of companies failing to claim back R&D tax credit for their work is huge and this is largely due to nothing more than the fact they didn’t realise they could claim, or they had been incorrectly advised otherwise.

But as these examples show, there are a whole host of unconventional and wonderful things that qualify for R&D tax credits and so it’s always well worth looking into.”

R&D Tax Credits
Articles

Four Things Your Business Does That Qualifies You For R&D Tax Credits

R&D Tax Credits

Four Things Your Business Does That Qualifies You For R&D Tax Credits

 

When people think of research and development (R&D), they often picture large corporations or specialist science, tech or pharmaceutical companies. This explains why, despite the Government’s efforts to encourage innovation in UK industry through the introduction of R&D tax credits, only one in five (19%) of businesses that can be classed as being ‘innovation active’ have ever claimed money back for their time developing new products or processes.

This could be due to the complicated nature of processing the claims, as many business owners may not understand what qualifies as R&D or how to go about making a claim. To help companies to better understand the confusing world of R&D tax credits, industry expert Nigel Urquhart, Technical Analyst at MPA, has outlined four things businesses could be doing to qualify for R&D tax credits – simply by continuing the work you’re already doing.

Developing technically improved products

If you are a business that manufactures products and you’re constantly working to improve those products through research and experimentation, this qualifies as R&D. One surprising thing is that whether you’re successful or not in developing a new product doesn’t actually matter as, in the case of R&D tax credits, any time spent on the process still counts.

One company that has been successful in producing technically improved products and claiming R&D tax credits is Bee Lighting, which develops lighting for vehicles that are used on land, sky and sea. It has an innovative approach to work, investing in high design and engineering specialism to produce products that exactly meet a client brief for new bulbs. In one case, to create the right single small light for one client it developed and tested over 100 iterations of lens shape, 1000 frosting effects and four ways of fixing the lens. That led to a happy client, and the work that went into it qualified for a R&D tax rebate.

Is your business doing something similar?

Creating new systems or software to improve your quality of service

When businesses see a new software or manufacturing development that would enable them to improve their product or service, it’s common to look at ways of integrating that technical advancement into what they do in order to improve service quality. The good news is that if you’re doing that you could qualify for R&D tax credits.

One example of a business that has done this successfully is Logistex, a leading logistics integration company, which worked in collaboration with Pharmacy2U, a pioneer in digital healthcare, to design and develop an automated system to accurately pick, pack and dispatch both prescribed and over-the-counter medicines, at a rate of over 600 prescription orders per hour. The new system integrates a range of technologies, including pick to light, an automated packaging solution and automated twin headed dispensing robots; all of which presented technical challenges in development. Bringing these new technologies into its offering helps move the industry forward and enabled Logistex to claim R&D tax credits.

How are you bringing technical innovations into your business’ systems and processes?

Modifying existing systems to improve efficiency, capacity or performance

Almost every business, no matter which industry or market it operates in, will want to improve efficiency, capacity and performance. Looking at ways to improve this won’t only increase output, sales and, long-term, the profit of the business, it will also qualify the organisation for R&D tax credits.

Brainomix, a world leader in imaging software for neurological and cerebrovascular diseases, identified that a lack of timely, available expertise for brain CT scan interpretation can delay stroke patients from accessing life-saving treatments. Building on the systems that are already out there, it has since developed the CE-marked, award-winning stroke imaging software, e-ASPECTS. This modification to the existing CT scan helped support stroke physicians deliver fast, consistent diagnosis. However, organisations don’t need to be saving lives to qualify, they just need to show how the work they have done has improved performance.

What innovations are occurring in your business to improve the efficiency and performance of your staff or products?

Developing bespoke solutions for particular problems

Every client is different and there won’t be many businesses that haven’t been presented with a unique problem by a particular client. Principally of course, the work that goes in to developing solutions for a particular problem is to meet your client’s needs. However, it also has the added benefit that it makes you eligible for R&D tax credits.

One business that has been able to do this successfully is 48.3 Scaffold Design Limited, highly skilled structural engineers who design and develop scaffolding systems for commercial projects throughout the UK. It believes that it’s not about generic scaffold designs and want to create unique systems and challenging projects that develop new solutions. By taking this distinct approach and pushing the boundaries in its field, the business qualifies for R&D tax credits – like many others in the building sector which are looking for ways to improve current systems.

What bespoke projects is your business working on that could qualify for R&D tax credits?

Nigel Urquhart, Technical Analyst at MPA Group, adds: “In our experience, UK businesses are some of the most innovative in the world when it comes to advancing their products, systems and services. However, relatively few are aware that this entitles them to make huge savings when it comes to R&D tax credits. Of course, most businesses develop new products and processes simply to meet the needs of clients and customers, yet this quality of service doesn’t only help improve reputation, it could easily save them tens of thousands of pounds each year too.”

MPA Group is exhibiting at Advanced Engineering 2019. To find out more about the R&D Tax Credit incentive, visit: https://www.thempagroup.co.uk/rd-tax-credits/

van driver
ArticlesInsuranceWealth Management

Insurance Premiums Continue to Slow For Van Drivers

van driver

Insurance Premiums Continue to Slow For Van Drivers

 

Van drivers across the country are benefiting from a continued reduction to their insurance premiums, contradicting the industry’s prediction of premium increases in the wake of the Ogden rate change, new analysis from data analytics company Consumer Intelligence shows.

Its Van Insurance Index shows average premiums have fallen to £1,781 in the three months to September.

Since Consumer Intelligence started tracking insurance premiums five years ago, van insurance premiums have increased across the market by 34.4%, primarily driven by increased claims costs. The value of claims are increasing as more technologically advanced vehicles require higher repair costs, exacerbated amid Brexit uncertainty by the need to import parts for vehicles manufactured overseas.

Under 25s experienced a premium drop of 9.3% in the past year, yet average prices remain the highest at £4,673. Meanwhile, in the same 12-month period, a 2.4% price rise for the over-50s saw their average premiums increase to £581 annually. This compares to £843 for van drivers aged 25-49, who noticed their premiums nudge up by just 0.3% in the last 12 months.

Drivers operating their vans as a car substitute are benefiting from falling insurance premiums. A typical ‘social, domestic and pleasure’ policy today costs £1,691 – down 3.1% in the last 12 months.

Meanwhile, drivers using their vans for business have seen premiums rise 0.3% over the same period. An average ‘carriage of own goods cover’ now stands at £1,805.

John Blevins, Consumer Intelligence’s pricing expert, said: “Whilst claims costs continue to be one of the main drivers for premium changes in this market over the long-term, we are seeing premiums trending down over the last 12 months.

“It appears that the Ogden rate reset hasn’t had quite the impact some in the industry predicted. The price reductions over the last quarter have actually confounded many forecasts.”  

Brexit
MarketsRegulationSecurities

GDPR post Brexit and the impact on financial services

Brexit

GDPR post Brexit and the impact on financial services

By Ian Osborne, UK & Ireland VP, Shred-it

October 31st has been and gone. Yet despite the Prime Minister promising to deliver Brexit by this date, the UK remains part of the EU at least until January 31st 2020, following last week’s confirmation of the extension. And even then, it is still not clear exactly what will be, as MPs are interrogating the deal while preparing for a General Election on 12th December.

Like many industries, financial services have felt the effects of uncertainty surrounding if, how and when the UK will leave the EU. With London the epicentre for financial services in Europe, the wider potential impact is enormous.

The biggest fear amongst the business community has been that global companies will move their operations from the UK to other countries within the Eurozone.  Another cause for concern has been that companies will increasingly pause or divert investment in the UK, leaving Britain’s economy in stagnation.

On a more operational level however, there remain questions around EU regulations and how Brexit will impact financial services businesses from a regulatory perspective.  Take data protection, which was brought to attention last year with the introduction of the EU’s GDPR, and is today a big challenge for the industry.

According to data from the Ponemon Institute in 2017, financial services companies that experienced an information breach suffered the highest cost per capita than any other industry, at £154.  Furthermore, data left in insecure locations was the number one source of reported incidents in the finance sector in the UK (PwC for the ICO 2017).

Guidance from the Information Commissioners’ Office has recently confirmed that most of the data protection rules affecting businesses will remain the same post-Brexit.  The good news is that financial services companies that comply with GDPR and have no contacts or customers in the EEA (which constitutes EU countries plus Iceland, Norway and Liechtenstein) don’t need to do much more to prepare for data protection after Brexit.

However, organisations that receive personal data from contacts within the EEA must take additional steps to ensure they are fully compliant after Brexit, which may require designating a representative in the EEA.

Brexit aside, there remain questions as to how compliant with GDPR businesses are across the UK, despite it being a year since the legislation was introduced.  Financial services organisations that saw the introduction of GDPR as an opportunity to get their data-house in order and to improve the quality of the personal data they store are certainly reaping the benefits of last year’s GDPR efforts.

To assess the attitude of businesses in general, Shred-it commissioned a survey of 1,439 UK-based SMEs (under 500 employees) which found that 72 per cent of respondents said they were very aware of GDPR.

While this presents positive news, the biggest concern is whether that confidence in GDPR-readiness is justified. Less than half (45 per cent) of the firms who said they were ready to deal with data protection requirements also said they had reviewed their policies recently. Just over a third had contacted their customers to confirm consent to data use, less than a quarter had published a privacy notice, and just over two in 10 had reviewed, deleted or destroyed personal data.

These results suggest that businesses across all sectors – including financial services – need to take a more proactive approach to data protection.

So how can financial services firms ensure they are GDPR compliant?

Keep up to date with privacy laws

First things first. Businesses must stay up to date with privacy laws and understand what action – if any – they need to take to comply – particularly post-Brexit. Clear guidance is provided by the ICO website.

Customer communication has changed

Since the introduction of GDPR in 2018, financial services companies have had to rethink their strategies for communicating with customers. For example, customer e-marketing activities, such as newsletters, now require assessment post-GDPR and businesses must seek permission from customers to store their personal data and contact them with offers and promotions.

Protect your digital data

It’s important to remember that data protection refers to both digital information, as well as paper records. For digital data, financial services firms can take simple measures to ensure they are compliant with GDPR, including setting secure usernames, passwords and PINs for all devices, installing anti-virus software and a firewall on hard drives, avoiding posting confidential files on social media platforms, and avoiding opening files or links from an unknown sender.

Don’t forget paper records  

Not everything you collect, store, or handle is digital. When financial forecasts or year-end results are printed for a meeting, when reports or agendas are circulated for a meeting, they are at risk of getting into the wrong hands if they are not handled and disposed of properly and securely. Best practice should include the provision of locked confidential information consoles that are easily accessible, and company-wide policies that encourage a clean desk at night.

Business leaders should also be arranging for the secure destruction of documents after use or after prescribed periods of mandated storage, keeping only digital copies of essential files in an encrypted format.

Educate staff on data protection policy

In an industry that relies on privacy and confidentiality, the reality is that many information breaches happen not because of inferior firewalls or passwords, but because of employee error, negligence, or poor judgement. You may be doing everything you can but one employee, casually dropping a draft financial report into the recycling, can undo everything.

Finance services companies must have a strict policy on how to identify, handle and securely dispose of confidential information, that is communicated clearly to all employees and updated whenever necessary to avoid a potential breach.

Ian Osbourne
This article was written by Ian Osborne, UK & Ireland VP, Shred-it
R&D tax relief
Corporate TaxRegulationTax

Manufacturers top the R&D tax relief table – is your sector lagging behind?

R&D tax relief

Manufacturers top the R&D tax relief table - is your sector lagging behind?

Manufacturing firms claimed £1.25bn using R&D tax relief in the 2017-18 financial year, more than any other industry sector, a study from R&D tax credit experts, RIFT Research and Development reveals.

Manufacturing firms also made the highest number of claims over the period, at 11,925.

The R&D tax relief scheme is effectively Corporation Tax relief that can reduce a company’s tax bill and R&D specialists, RIFT, have dissected the latest industry data. This shows which sectors are submitting the most claims, the sectors being awarded the most in successful claims, and those that are bringing home the largest sums financially with just a single claim.

Other major users of R&D tax relief

Professional, Scientific & Technical firms came in second by amount, claiming £1.02bn annually. Behind that sector was Information & Communication (£820m), Wholesale & Retail Trade, Repairs (£235m) and Financial & Insurance firms (£215m). The smallest amounts claimed were from firms in Accommodation & Food (£5m), Real Estate (£10m), and Electricity, Gas, Steam and Air Conditioning (£10m).

Information & Communications rank high on number of claims

Information & Communication firms made 11,635 claims over the period, the second highest behind Manufacturing. Professional, Scientific & Technical firms were also responsible for 9,545 claims. There were only 125 claims for the Electricity, Gas, Steam and Air Conditioning sector, while there were just 215 claims by Real Estate firms. 

Mining & Quarrying dominate high value claims

The Mining & Quarrying sector has by far the largest average claim amount, at £1.16bn. However, despite the extremely high value, there were only 95 claims over the course of the year in that sector.

Other high value sectors per average claim were Financial & Insurance firms (£232,400), while third on the list was Arts, Entertainment & Recreation (£157,900). Once again Accommodation & Food was the smallest sector regarding claims (£21,700), while another comparatively low value sector was Wholesale & Retail Trade, Repairs (£44,000).

Head of RIFT Research and Development Limited, Sarah Collins commented:

“It’s been interesting to see how the dynamics of the research and development landscape have changed, as more and more companies from a wide variety of sectors have started to utilise the scheme.

“Of course, a sector like manufacturing is likely to provide more regular opportunities to further develop the practices being used through R&D and so it’s no surprise that it leads the way for both the total amount claimed and the number of claims. However, when it comes to the value of the claim, it can very much be a case of quality over quantity, with some of the less prolific sectors for overall claims contributing with some of the highest values of R&D tax relief.”

Sector League Table - £ amount claimed
Sector League Table - Number of claims
Ranking League Table - average £ per claim
investments
BankingTransactional and Investment Banking

British Business Investments makes £15m Tier 2 capital facility available to PCF Bank

investments

British Business Investments makes £15m Tier 2 capital facility available to PCF Bank

 

British Business Investments (BBI), a commercial subsidiary of the British Business Bank, has announced a new £15m Tier 2 capital facility to specialist bank, PCF Bank.

PCF Bank has a long history as a specialist financier of vehicles, plant and equipment. Established in 1994, and launching banking services in 2017, PCF Bank has helped more than 18,000 customers with purchasing business critical assets for their businesses.

The facility will enable the Bank to draw on additional capital as required, allowing it to utilise capital in an efficient and earnings enhancing manner as the business grows. This investment could support up to an additional £125m of asset-based lending to UK smaller businesses.

The £15m capital investment is a Tier 2 capital facility provided through BBI’s Investment Programme, which is designed to increase the supply and diversity of finance for smaller businesses by boosting the lending capacity of challenger banks and non-bank lenders. Since it launched in 2013, the Investment Programme has committed over £900m to providers of finance to UK smaller businesses.

Catherine Lewis La Torre, CEO of British Business Investments, said: “This commitment to PCF Bank supports British Business Investments’ objective to increase the diversity of supply of business finance. Banks like PCF help diversify the finance market, and in turn contribute to more choices for smaller businesses across the UK.”

Scott Maybury, CEO of PCF Bank, said: “PCF has been helping UK SMEs purchase the assets they need for over 20 years. Since launching as a bank in 2017 we have been able to increase the size of our lending book driving profitability in a sustainable way. This facility from British Business Investments will allow us to continue to grow and support the UK private sector.”

The Investment Programme unlocks increased development capital to speciality lenders and challenger banks serving smaller businesses and enables BBI to support the development of diverse finance markets.

Wealth and Finance
Cash ManagementPensionsPrivate BankingReal EstateWealth Management

The Mosaic of Modern Wealth: Wealth Advisers Must Keep Pace with Globally Mobile Clients

Wealth and Finance

The Mosaic of Modern Wealth: Wealth Advisers Must Keep Pace with Globally Mobile Clients

 

By Axel Hörger, CEO Europe at Lombard International Assurance

The world’s wealthiest people are on the move. According to this year’s Knight Frank Wealth Report, 26% of ultra-high-net-worth individuals (UHNWIs) are planning on emigrating in the next year. An astounding 36% already hold a second passport. For many, the ability to move their lives, families and assets freely around the world is the new norm.

This trend has been growing for well over a decade, fuelled by increased competition between countries seeking to attract the world’s wealthiest and drive investment. From France to Thailand, countries are seeing the benefit of adopting competitive tax regimes, investment-based visa schemes, and fast-tracked citizenship programmes. Since 2000, 20 EU member states have implemented these types of policies, resulting in approximately $28 billion in foreign direct investment.

For countries like Malta and Cyprus, this has led to a much-needed economic boost as thousands of wealthy individuals have invested in their local economies in return for residency or citizenship. In Portugal, attractive tax rates have in part led to a remarkable economic rebound, with GDP growth set to be one of the highest in Europe, while Lisbon and Porto consistently top the list of most attractive places to live in the world. As countries look to replicate this type of success story, global mobility is only set to increase.

But as global mobility increases so too does the complexity of managing wealth. Globally mobile clients will look to their advisers to be able to seamlessly manage their cross-border wealth, regardless of where they look to base themselves. And as many of the residency by investment programmes have a time limit, moving to a third or fourth country over a ten-year period is becoming increasingly normal. Wealth solutions for truly globally mobile clients need to be able to facilitate this unprecedented level of cross-border movement.

Advisers will also have to be aware that the globally mobile HNW and UHNW client base they are serving is expanding. In 2018, $8.7 trillion of personal financial wealth was held cross-borders – roughly 4.2% of the global total. The fabric of modern-day wealth is evolving as the sources and destinations of this wealth are set to change significantly over the coming years. For example, Boston Consulting Group predicts that by 2023, the value of Asia’s cross-border wealth will have grown by 150%.

Wealth advisers will need to keep pace with this dramatic shift and cater for the changing needs of this growing client base. Driven by continuing economic and political uncertainty in the region, HNWIs and UHNWIs from emerging markets will increasingly seek asset safety, protecting against currency depreciation, and the desire to gain stable returns through international diversification. What these clients need are wealth structuring solutions that can manage cross border wealth spread across multiple developed markets. They will also need advisers who are able to navigate effectively around any regulatory or cultural differences between markets.

The mosaic that makes up the lives of modern wealthy people is constantly shifting and being redesigned as wealth is distributed across a more diverse range of ages, genders and nationalities than ever before. What drives wealthy people around the world has never been so complex. For wealth advisers, this means greater difficulties and greater opportunities. The wealth management industry needs to understand the changing landscape that faces HNWIs and UHNWIs and offer solutions that can help them to navigate the uncertainty and complexity.

When I speak to clients, what they are looking for is comfort that their adviser has expertise across multiple markets and jurisdictions. What they want is a feeling of control over their wealth and life’s legacy wherever they are, wherever they want to be, and regardless of what lies ahead.

For more information about Lombard International Assurance, visit our website.

Commodities
Capital Markets (stocks and bonds)CommoditiesFX and PaymentStock Markets

Top five things you need to know about commodities

Commodities

Top five things you need to know about commodities

 

Commodities are the lifeblood of commerce and economic growth. Daily FX, the leading portal for forex trading news, has built an interactive tool showing global commodity imports and exports over the last decade.

This unique tool allows traders to spot developments in the flow of commodities and the growth of both supply and demand while comparing the changes to critical economic indicators.

‘Global Commodities’ takes the form of a re-imagined 3D globe where the heights of countries rise and fall to show the import and export levels of a range of commodities over the last decade. The data visualisation allows users to switch views from a single commodity or market and show information relevant to that commodity or market’s performance.

John Kicklighter, Chief Currency Strategist at DailyFX, has used the tool to put together his top five things you need to know about commodities:

1. Will the US-China trade war lead to trade peace and synchronous growth to help commodities?

The US-China trade war is seen globally as a hindrance to growth, and as such, a hindrance to the demand for commodities. The International Monetary Fund warned governments to be  “very careful” and that the global economy remains vulnerable, and presumably, so do commodities until the issue is sorted out.

2. Will the US dollar strength continue and continue to suppress commodity price gains?

Since commodities are priced in US Dollars, a stronger USD as evidenced by the 6% gain in the US Dollar Index since the start of 2018 has had a positive impact on commodity price gains.

3. Will inflation pop up to increase the demand for commodities as a value store?

The lack of inflation has baffled central bankers and kept speculative buyers of commodities at bay.

4. Could a renewed China stimulus plan give industrial metals like copper the price boost and reverse weak sentiment?

Chinese stimulus via credit growth and top-down building projects have helped commodities in recent years find renewed demand, and the hope among commodity buyers is that there is more stimulus left in the tank.

5. Will US manufacturing turn around after falling at the start of 2019 to also lift commodities’ outlook?

A significant reading of the US Manufacturing Sector, the Institute of Supply Management recently touched the weakest levels since 2016 alongside Chinese Manufacturing weakness that has heavily weighed on commodities in general and especially metals like copper.

To learn more about Global Commodities visit: https://www.dailyfx.com/research/global-commodities

gdp
FundsRegulationTaxWealth Management

Boom or bust? Brexit’s impact on innovation and R&D

gdp

Boom or bust? Brexit’s impact on innovation and R&D

 

Brexit will undoubtedly affect life in the UK in several ways. The nature and extent of its impact, however, is anyone’s guess. Regarding research and innovation, on the surface not much should change. The R&D Tax Credit Scheme is a government initiative and while it is subject to European Union rules, ultimately the money is provided by HMRC, so the amount of funding available for creative pursuits should not be affected.

But Brexit will likely alter the entire business landscape for UK companies and these wider changes may indirectly affect the state of play for those looking to innovate.

Here innovation funding specialist MPA, which is exhibiting at Advanced Engineering 2019, looks at the implications of Brexit on innovation and R&D in the UK, and whether the current political uncertainty will actually give way to a more prosperous environment for businesses.

Funding freedom

According to the latest figures from the Office for National Statistics, UK spending on R&D rose by £1.6 billion in 2017 to £34.8 billion, placing it 11th in the EU for R&D expenditure as a percentage of GDP.

While such figures are impressive, with an average of £527 spent for each person in the UK, the spending is somewhat restricted by EU regulations. R&D tax credits are classed as ‘state aid’ by the EU and as such there are currently limits on how much the government can hand out to companies.

Once the UK leaves the union, this cap is removed, opening the door to higher value handouts and less strict qualification criteria. Such a move would be welcomed by SMEs across the country and would signal to the world that the UK is strongly encouraging innovation. Plans to increase funding are already in place, with the government’s long term industrial strategy aiming to raise R&D investment to 2.4% of GDP by 2027.

There’s widespread anxiety about the impact of Brexit on British industry and the government faces significant pressure to provide a boost for the economy. Investment in innovation would be a clear statement that the country is still thriving despite the political overhaul.

With the government potentially looking to reallocate some of the money they currently send across to Brussels, there could be funds available for such action.

Regardless of the nature of the UK’s trading relationship with the EU post-Brexit, innovation is always going to be vital for businesses to stand out and thrive in competitive industry landscapes. If trade deals put UK companies at a disadvantage on the world stage, the need to be creative and forward-thinking increases tremendously.

International collaboration

While international funding for UK research has fallen in recent years,from £5.6 billion in 2014 to £5 billion in 2017, it still comprises 14% of all investment in innovation. But it’s not just the financial connection to Europe that UK companies will have to cope without after Brexit, but the level of continental collaboration currently in operation at universities and research centres across the country.

UK industry and innovation is revered across the globe, with our institutions producing world-leading work in every sector. Such breakthroughs are only possible by bringing together the best people from across both Europe and further afield. In fact, in the decade prior to the 2016 referendum, 50% of all UK research publicationsinvolved a co-author from overseas. Moving forward, Brexit may make it more difficult for businesses to recruit staff from overseas and make cross-country projects rather impractical, if not impossible. There is talk of plans to only allow immigrants who earn over £30,000 to stay in the country and this could make it difficult for bodies to continue hiring skilled international research assistants and graduates as salaries for these jobs are generally below the threshold.

Britain’s booming tech industry has given the country potential to dominate and grow in IT and many other sectors. Mark Sewell, CIO of Microsoft recruitment partner Curo Talent, explains that for the many industries developing IT infrastructure, such as in financial services, there is concern that there may not be enough IT talent available to match increased demand. The average age of the IT workforce is increasing, and Britain’s education system is not producing an adequate number of skilled workers to replace these employees once they retire. This is exacerbated by Brexit and its restriction on access to talented EU-workers. To continue this development, businesses need IT workers with the skills to deploy the latest technology, unfortunately this talent pool may become limited.

Such barriers may force businesses to seek ventures elsewhere. Even British companies might start to launch their innovative operations overseas, targeting countries which have both good R&D incentives and simpler immigration policies, allowing multi-national teams to work without obstacles. Asian nations might be among those that benefit, with China and South Korea as potential suitors. In recent years, South Korea has been one of the world’s biggest investors in R&D and UK businesses could cash in on the country’s commitment to progress.

Uncertain fortunes

As with most aspects of Brexit, no-one really knows how the UK leaving the EU will impact on homegrown innovation. While some relevant policies will remain unchanged, such as the general R&D claim process, there are wider-reaching implications which could affect British researchers.

The UK has an excellent reputation for innovation and this could prove significant. If our economy suffers as a result of Brexit, the value of the pound against other currencies will fall. As such, global businesses may see British companies as attractive investments, as their quality services and projects will suddenly be available for smaller sums. This could potentially fill the void left by current EU funding.

R&D tax credits and Patent Box relief will play a crucial role in establishing the UK as a creative force post-Brexit. Once EU funding for projects is removed, the importance of the domestic HMRC initiative will amplify tremendously, potentially causing a rapid increase in applications.

Continuing and improving the financial incentives for businesses to spend time on R&D will ensure that the country continues to be at the forefront of innovation. MPA’s guidance on the R&D Tax Credit Scheme and Patent Box relief will help you see whether your company qualifies for the initiative.

MPA is exhibiting at Advanced Engineering 2019 and can be found at stand C14 in the Automotive Engineering section.

Retirement fund
Cash ManagementPensionsTransactional and Investment Banking

Retirement fund is top saving priority for Brits

Retirement fund

Retirement fund is top saving priority for Brits

 

Over half (58%) of Brits wish they had invested in their future and retirement at an earlier age, according to new research by savings and mortgage provider Nottingham Building Society, known as The Nottingham.

The survey of 2,000 UK adults looked at the biggest saving priorities for the nation, and what age we wish we had started investing in different aspects of our lives, from health and careers to money management. A retirement fund was ranked as the biggest saving priority, despite only 29% of respondents admitting to actively saving towards their future.

The top ten most important saving priorities for Brits are:

  1. Retirement fund

  2. ‘Rainy day’ fund

  3. House deposit or increasing equity

  4. Holiday fund

  5. Funds to partake in my hobbies / outside of work activities

  6. Debt repayments

  7. New car

  8. Children’s saving account

  9. Children’s education

  10. Wedding fund

Debt repayments didn’t make the top five saving priorities for the nation, however, of the respondents who are currently saving, paying off or planning to pay off their debt, this saving was ranked second in importance, indicating that those who are currently in debt are prioritising this over saving for other factors such as a house deposit (ranked fourth in importance), or a new car (ranked seventh).

However, when it comes to what Brits are actually saving for, the most common goal was a ‘rainy day’ fund, with over a third (34%) of Brits currently saving towards this. Interestingly, more than double are saving towards a holiday (29%) than a house deposit (13%), despite a house deposit being ranked as a higher priority overall.

When it comes to the ages the nation wish they had started investing in different aspects of our lives, Brits found that they wished they had invested towards their retirement at age 31, when on average they actually began investing at 39 – almost a decade later. On average, UK adults begin saving towards a ‘rainy day’ fund at 34, despite wishing they had started at 28.

Retirement data

 

Jenna McKenzie-Day, Senior Savings Manager at The Nottingham, said: “Our research found that on average, homeowners wish they had begun planning to buy their first home three years earlier than they started, with a similar picture being painted for those saving for their future. Interestingly, it found that Brits wish they had started their retirement fund a staggering eight years before they actually began saving.

“Whether you are saving for your first home or starting your retirement plans, products such as the LISA, which is available for those looking to plan for their future, offer a 25% government backed bonus on annual savings  up to £4,000, those extra eight years of savings could have increased their future savings by a potential £8,000 – making it the perfect product to start your saving journey.”

To find out more about the Nottingham’s LISA, visit: https://www.thenottingham.com/lifetime-isa/

R&D
ArticlesCapital Markets (stocks and bonds)Corporate Finance and M&A/DealsTaxWealth Management

Meet the company recouping hundreds of thousands for UK business in R&D tax relief

R&D

Meet the company recouping hundreds of thousands for UK business in R&D tax relief

 

While growth in R&D tax relief claims has increased by 35% annually since inception in 2001 to over £4bn last year, and has already returned £26bn in total tax relief to businesses across the nation, the scheme is yet to be fully utilised by UK business according to R&D tax credit specialists RIFT Research and Development Ltd.

RIFT secures each client an average of more than £60,000 in tax relief due to R&D across sectors such as construction, manufacturing, agri-foods, ICT, advanced engineering, business and finance, mining and even education, but believe many are still failing to take advantage of the financial benefits. 

Introduced by the Government, the scheme is almost two decades old and encourages scientific and technological innovation across a plethora of UK business sectors. 

 

What is it?

It’s essentially Corporation Tax relief that when utilised, could reduce your company’s tax bill and in some cases, it can even result in you receiving payable tax credits.  

A company can qualify for R&D relief when they carry out research and development within their respective sector with the intention of advancing the overall knowledge or capabilities of science and technology within that field.  

 

R&D tax relief schemes

There are currently two R&D tax relief schemes in operation although the most beneficial is that aimed at SMEs which considers companies with a headcount of less than 500, a turnover of £86.3m or a balance sheet total below £74.3m – learn more.

If you want to see if your company qualifies and the types of costs you can reclaim, RIFT can also help you – learn more.

 

R&D sector success stories

RIFT has worked with countless companies who weren’t just unaware of R&D tax relief but had been incorrectly told by their accountants that they didn’t qualify.   

Here are some of the highest value claims.

Automotive: RIFT worked with an automotive industry tool manufacturer and identified £900,000 worth of qualifying costs, of which, the company was able to recoup £180,000 worth of previous costs.

Construction: RIFT worked with a leading construction company and identified £2m worth of qualifying costs for ongoing innovation across the entire business. Their accountant had identified just £50,000 worth of qualifying costs relating only to some new software they had developed and failed to recognise the gravity of the work they were doing within the sector. 

Architecture: Working with a private limited company practice within the architecture space, RIFT identified £1,000,000 worth of qualifying costs per year, after their accountant had told them their activities didn’t qualify as R&D.

Software: Thanks to RIFT, a client developing software was able to claim back a huge £750,000 from HMRC after £2.3m in qualifying costs were identified.

 
Head of RIFT Research and Development Limited, Sarah Collins commented:  

“Across the UK we have such a wealth of great businesses driving their respective sectors forward through research and development and it’s only right that they should be recognised in one form or another for doing so.  

However, time and time again, we see companies who are really leading the charge but are failing to maximise the return on their efforts by neglecting R&D tax relief. Some aren’t aware of the scheme full stop, while some are, but just didn’t realise that the innovative work they’re carrying out qualifies.  

Particularly now, while many SMEs are struggling with the potential implications of leaving the EU and the reductions in funding this might bring, R&D tax relief provides a very real, Brexit proof opportunity to maximise financial viability.”

CX-Platforms
BankingTransactional and Investment Banking

Purpose-Built CX Platforms ensure banks are meeting the needs of vulnerable customers

CX-Platforms

Purpose-Built CX Platforms ensure banks are meeting the needs of vulnerable customers

 

FCA consultation shines spotlight on fair treatment, putting pressure on financial services to implement suitable solutions.

In July, the Financial Conduct Authority announced the launch of a consultation on proposed guidance for firms on the fair treatment of vulnerable customers. As a leading provider of Customer Experience Management (CEM) solutions, Clarabridge, Inc., is stressing the ability of dedicated technology to maintain compliance and ensure fair treatment of all customers. Without it, the firm says, banks and financial services companies are in danger of failing customers and breaching regulations.

The Clarabridge solution is widely used in the finance sector, and it is already helping companies to develop interactive dashboards to assist contact centre and customer service staff in monitoring the experiences of vulnerable customers.

“Any time customers make contact, it is not always easy for customer service agents to quickly understand their challenges,” said Jagrit Malhotra, Managing Director EMEA at Clarabridge. “Vulnerable customers may face a variety of difficulties and obstacles that affect their interactions. Our technology allows banks and financial institutions to analyse these interactions in great detail, thereby uncovering the sentiments that customers are expressing, the effort that they are making to access services, and how this can be improved to enhance the overall journey.”

The FCA has stated that whilst many firms have made significant progress in how they treat vulnerable customers, there needs to be more consistency. It says that in some cases, a failure to understand their needs is leading to harm.

In the last six months, Clarabridge has designed tailored dashboards for a prominent UK bank and a leading insurance company to help them analyse data from sources such as phone calls, web chats, email and social media posts. By identifying and addressing negative feedback, including that from vulnerable customers, financial organisations can prioritise improvements to help these customers while also addressing areas of compliance or regulatory risks.

“Financial services companies can ensure fair and consistent treatment of customers by proactively identifying the root causes of problems,” continued Malhotra. “The news features reports of banks discriminating against the disabled in overdraft charges, for example, or failing to indemnify vulnerable customers against fraud. We can use highly advanced analytics to help organisations quickly tackle issues, consistently meet FCA guidelines, and gain a deeper understanding of the very real needs of their customers.”

Clarabridge’s AI-powered solution also meets the banking industry’s need for fast-turnaround implementations. Its modules are customised to the unique workflow of the industry and include Complaints & Compliance Analysis, Digital Experience (Mobile App & Website), Branch & ATM Experience and Contact Centre Experience.

To learn more about this solution for retail banking and other industries, please visit: https://www.clarabridge.com/solutions/industry/banking/

Employee spending
FundsWealth Management

Friday 10am is peak time for employees splashing the company cash

Employee spending

Friday 10am is peak time for employees splashing the company cash

 

  • Company cards are most used at supermarkets and service stations

  • Fast food is bought more often than train tickets

  • Workers are most reliant on caffeine on Wednesdays, with West Midlands the coffee capital

Business owners and finance bosses may want to look away on Friday mornings as this is the most popular time for spending on company cards, according to new research. 

 

The data from business card provider, Capital on Tap, reveals that businesses spend more money on its company cards at 10am on Fridays than any other time during the working week, with the following hour also among the costliest periods. 

 

The top five times of the week for spending on company credit cards: 

1.       Friday 10am: users spend 225% more than they would usually  

2.       Tuesday 10am: users spend 223% more than they would usually 

3.       Monday 11am: users spend 214% more than they would usually 

4.       Friday 11am: users spend 213% more than they would usually 

5.       Wednesday 11am: users spend 208% more than they would usually 

 

Supermarkets and service stations are the most frequented locations for company credit cards, with the highest number of weekly transactions (16.7% and 15% of all weekly purchases respectively). 

 

There are also more purchases made on company cards in fast food establishments (4.9%) than for more traditional business activities such as rail travel (2.8%) and overnight accommodation (3.3%). In fact, Saturday lunchtime is the most popular time for fast food spending, with KFC (£11.67 spent per visit) proving more popular with workers than Burger King (£11.25) and McDonalds (£8.12). 

 

Out of hours spending at the pub is also a popular business expense, with end-of-week celebrations the peak time for spend in drinking establishments – 21% of this taking place between 8pm-9pm on a Friday. 

 

Gone are the days of the Monday morning ‘pick me up’, with only 19.2% of the week’s coffee purchases taking place at the beginning of the traditional working week. Instead, workers are looking for a midweek caffeine boost, with 21.4% of coffees being bought on a Wednesday. 

 

West Midlanders are the most reliant on coffee to fuel their working week, spending £9.22 in coffee shops on an average visit, while those in Wales are least dependent on the beverage (£6.56). 

 

Coffee spend per region: 

1.       West Midlands: £9.22 

2.       Northern Ireland: £8.79 

3.       North East: £8.79 

4.       Scotland: £8.70 

5.       Yorkshire and the Humber: £8.48 

6.       East: £8.41 

7.       North West: £8.30 

8.       South West: £7.80 

9.       London: £7.62 

10.   South East: £7.40 

11.   East Midlands: £7.22 

12.   Wales: £6.56 

 

David Luck, CEO of Capital on Tap, said: “It is interesting to find when workers are spending most on their work credit cards and spot patterns in how businesses are evolving. Finding that Friday evenings are popular for pub spending and Saturdays are peak times for fast food shows that business expenditure is not as traditional as we might have thought. 

 

“A refreshing diversity of spend was seen on Capital on Tap cards. Given our ability to service those that traditional banks opt-out of, it’s no surprise to see service station costs, lumber yards and parking lots as part of the funding use – retailers that are traditionally popular outside of the bigger cities.”  

HMRC
Corporate TaxTax

Leyton UK welcomes increase in R&D funding, but urges ‘further and faster action’

HMRC

Leyton UK welcomes increase in R&D funding, but urges ‘further and faster action’ by Government

 

Leyton UK, the country’s leading innovation funding consultancy, has welcomed the increase in R&D tax credit claims, announced last week by HMRC, but urged the Government to go further faster and to increase awareness and uptake of the scheme to ensure the UK keeps pace with other economies. R&D tax credits are a tax relief designed to encourage greater R&D spending, leading in turn to greater investment in innovation. They work by either reducing a company’s liability to corporation tax or by making a payment to the company.

The announcement by HMRC has revealed that there have been 48,635 R&D tax credit claims for 2017-18, of which 42,075 are in the SME R&D scheme, corresponding to £31.3bn of R&D expenditure. This is expected to rise and HMRC has now revealed that claims for the last complete year, 2016/17 indicate an overall increase of 20% from 2015-16. The increase was primarily driven by a rise in the number of SME claims, which totalled 45,045 in 2016-17, an increase of 22% from 2015-16.

Leyton highlights that the take up of claims from sector to sector and across the country varies. The Government has an ambitious target of 2.4% investment in R&D overall by 2027. The most recent ONS figures however revealed the UK’s investment to be just 1.69% of national GDP, well below the European average of 2.07%. This suggests far bigger increases in R&D investment will be required to come close to meeting this ambition. The need to focus on investment in innovation is clear and Prime Minister Boris Johnson promised to ‘double down’ on R&D investment in a recent speech at the Manchester Science and Industry Museum.

According to Leyton UK MD William Garvey: “The R&D tax incentive has become well established in the UK and we are seeing an encouraging take up as businesses realise the full scope of what they can claim. However, if the Government wants to realise its goal to ‘double down on R&D’ there needs to be better education and communication for SMEs as we have found awareness of the scheme varies from sector to sector and across the country. We would also suggest further financial incentive. The UK is blessed with a combination of creativity and technical brilliance that are the foundations for success in the future. To support innovation post-Brexit, Government will need to continue to invest.”

Leyton UK has witnessed impressive growth on the back of increasing awareness of the scheme, recently revealingannual revenue growth of 50% for the financial year 2018/2019, its most successful year in its 10-year trading history.

Angel Investment
Articles

Angel Investment Network reports strong annual revenue growth

Angel Investment

Angel Investment Network reports strong annual revenue growth

 

Angel Investment Network (AIN), the world’s largest online angel investment platform, has announced strong growth, with annual revenues up 9.4% year on year and a record number of deals for the broking business. AIN connects startups with angel investors and now has more than a million users in total on the platform.

AIN received over 100,000 pitches in the past year from entrepreneurs across the globe, with the figure doubling over the last two years. Alongside existing markets there has been a rapid growth of startups coming from emerging markets. Meanwhile investors registering on the site have surged nearly 40% year on year, now standing at more than 200,000 registered business angels.

Alongside the online platform, AIN also runs a successful broking division, which has seen exceptional growth in the past 12 months. Revenues have increased by 22% as demand for the team’s expertise increases. AIN has been involved in several significant raises in the past 12 months for a variety of business. This includes eco-friendly baby product business Kit & Kin, fully customisable bio-polymer plastic company Teysha, and Pin Point, data science offering early cancer detection.

Despite ongoing uncertainty around Brexit and a global slowdown, AIN’s results reveal the buoyant startup culture both in the UK and internationally and the popularity for this method of financing.  The biggest demand among investors over the past year has been for software-based business, however food & beverage and property ventures are also seeing impressive growth. Fast growth worldwide markets include India, Canada and Australia.

Additionally AIN has been expanding into new areas including a property investment site, BrickTribe and an impact-driven online hub SeedTribe, catering for the increasing demand from investors for businesses with sustainability at their core.

According to AIN co-founder Mike Lebus: “AIN is the largest network connecting angel investors with startups, and we continue to see strong growth with investors keen to connect to our wide pool of early-stage businesses. We reflect a strong, growing and resilient worldwide startup culture which has now taken root in every continent of the world. We are particularly encouraged by the performance of our broking business as more and more investors are coming to us for access to high quality dealflow.”

He continues: “We continue to operate a lean and agile business model and we are able to launch new products to respond to the needs of our users. This includes our two new standalone platforms, BrickTribe and SeedTribe, which we built to fulfil demand that we were receiving from our investors.”

Cyber threat
Corporate Finance and M&A/DealsFinance

EfficientIP and IDC Report Reveals: Financial services organisations suffer $1.3M cyber attacks

Cyber threat

EfficientIP and IDC Report Reveals: Financial services organisations suffer $1.3M cyber attacks

 

88% of financial services organisations surveyed experienced DNS attacks in the past 12 months.

EfficientIP, leading specialists in DNS security for service continuity, user protection and data confidentiality, revealed the financial services sector is the most targeted industry in its 2019 Global DNS Threat Report with 88% of FS respondents experiencing under-the-radar DNS attacks in the past year.

With 900 respondents from nine countries across North America, Europe and Asia, the report found financial services organisations experienced an average of ten attacks a year, a 37% increase from last year. In addition, 47% of financial services organisations were subject to DNS-based phishing scams.

Last year, a single DNS attack cost each financial services organisation $924,390. This year the research shows that each organisations on average spent $1,304,790 to restore services after each DNS attack, the most out of any sector and an eye-watering increase of 40%.

Rising costs is only one of the consequences DNS attacks caused for the financial services sector. The most common impacts included cloud service downtime, experienced by 45% of financial organisations, and in-house application downtime (68%).

While 65% of financial organisations are either already using or planning to incorporate zero trust architecture, they still appear to be behind the curve when it comes to making use of DNS analytics for enhancing overall network security. Just over 67% perform no DNS traffic analysis for their internal threat intelligence program, and 43% have adopted very little or no automation at all in their network security policy management. This still leaves the financial services sector vulnerable to DNS attacks, which appear to be on the rise. On the positive side, financial services organisations do see real value in using machine learning to bring predictive security into their capabilities. 90% of respondents see this as particularly useful for detecting unknown (“zero-day”) malicious domains.

David Williamson, CEO, EfficientIP, commented: “Financial services organisations have always been the gate-keepers of customers’ money, providing vital services people expect to be able to use all day and night. With so much at stake, the networks of financial services organisations are a predictable, prime target for DNS attacks.

“What is a surprise is these organisations are not amplifying their security measures. They are big targets with costly breaches coming thick and fast.
As our research shows, DNS security is a business imperative for the financial sector if hackers are to be kept at bay and to prevent services from caving in on themselves.”

card
BankingCash Management

Yordex introduces smart company card to spend management solution software, which cuts the cost and complexity of controlling business finances

card

Yordex introduces smart company card to spend management solution software - which cuts the cost and complexity of controlling business finances

 

UK fintech Yordex is making it simple for fast-growing companies to control business spend by adding company cards to its smart spend management solution, giving businesses complete visibility and authority over their current and future finances.

Expense management currently takes up a disproportionate amount of time and money within most organisations; on average, it costs in excess of $20 in people power to process every invoice or expense claim, while expenses only account for less than 6% of total company spend.* In addition, firms struggle to get a real-time picture of their financial health, as their existing software platform only provide a historical view of spend. It takes an average company up to 10 working days at month end to get an accurate account of what was spent the previous month.

Yordex is pioneering a new approach to managing business finances. Its smart solution provides 100% visibility over company spending – from cards and expenses to invoices and budgets – so businesses can control all current and future finances in one place, reducing the cost of spend management by 60-70%.

Adding company cards further enhances Yordex’s smart spend management solution, by empowering employees to make autonomous purchases within set spending limits. Receipts and invoices are automatically matched with expenses and the correct VAT rate is applied, significantly reducing the administrative and compliance burden placed on staff. Businesses can also manage online spending, such as subscriptions, through virtual cards, avoiding the need to unsecurely pass physical cards around the office.

By introducing smart company cards that are fully integrated with Yordex’s spend management platform, businesses will be able to make agile, insight driven decision-making enabling real-time spend visibility and accurate cash flow control through the use of Yordex’s financial reporting tools.

Erik De Kroon, co-founder and CEO of Yordex, comments: “As companies grow, their costs become harder to track. Businesses want to keep the fast decision-making capabilities of their early days, but there have been no financial tools available to help them achieve this – until now.”

“Yordex enables businesses to retain control over their spend as they scale up, so they can make rapid decisions based on real-time insights. Introducing smart company cards will make it even easier for fast-growing businesses to make intelligent choices.”

Companies already using the Yordex smart spend management solution will be offered complimentary cards as valued customers.

Erik concludes: “Every business is different, but they all have one thing in common: they’ve got better things to do than waste time on spend management. Our approach gives companies complete cash flow visibility without expensive, time-consuming software implementations, and adding smart company cards will enable business owners to focus on growing their business without compromising on financial insight and control.”

Ferrari
ArticlesCash ManagementInsurance

Purchasing your dream car – can it become a reality?

Ferrari

Purchasing your dream car – can it become a reality?

 

Buying a new car over one that is second-hand can bump up the price tag, but driving off the forecourt in your dream car is a feeling like no other. In fact, thousands of car buyers each year seek their dream car with a brand-new registration. So, without breaking the bank, how can you afford your dream car?

Buying a car by credit card

Paying through your credit card company can give you added protection on the full purchase cost (often as long as the value of the vehicle is over £100 and less than £30,000). Of course, you have to be able to meet your monthly payments too.

This method allows you to put down an even lower deposit than 10% and pay the rest of the vehicle off using a debit card. It’s best to consider all options here, as often the interest that you pay on a credit card could be significantly higher than that of a finance agreement.

If you want to buy a car by credit card however, it’s best to speak to your car dealer first as some dealerships don’t accept this method of payment.

Personal Contract Purchase agreement

PCP is an agreement where the end value of the car is agreed at the start of the contract, so you can plan your payments accordingly. Payments are often less than what you’d pay in a hire purchase agreement as you pay the full price of the car, plus interest but minus the guaranteed future value of the car. You must pass credit checks before you’re eligible for a PCP agreement.

When it comes to the end of your PCP agreement, you can either pay off the future value of the car to become the full owner, hand back the keys or trade the car in as a deposit for a new finance agreement.

To lower the monthly cost, you can place down a large initial deposit if you can afford it. Saving a lump sum for a large deposit is easier than saving up for a car, while reduced monthly payments can really help out too. Always evaluate your current monthly payments before you agree to a finance agreement, as being behind on your payments can lead to financial issues.

Be aware though, if you have exceeded the forecasted mileage on the car, there will be further charges to pay. This is because more miles decrease the value of the car. Also, any damage to the car will be charged to you, so you must be prepared to take good care of the vehicle.

Hire purchase agreement

This is relatively similar to a PCP agreement. It involves monthly payments with the option to purchase the car at the end of your agreement based on its new value.

A usual deposit for a car is 10% of the car’s value, but often you can pay more to reduce the follow-up monthly payments. The rest of the car is then payed off in instalments over a period of one to five years. The longer this period, the less you have to pay each month but due to interest charges, the total cost of the car becomes higher.

As we can see, there are a range of finance options available to you for purchasing new as oppose to used cars, allowing you to drive that dream car you’ve always wanted without forking out loads of cash. Save up what you can for a significant deposit and always make sure that you can cover the payments before signing any agreements.

santander
ArticlesBankingCash ManagementFinanceTransactional and Investment Banking

Santander Consumer Finance is expanding its online loan application platform across the UK

santander

Santander Consumer Finance is expanding its online loan application platform across the UK delivering an end-to-end digital solution

 

Santander Consumer Finance (SCF) is expanding its online loan application platform across the UK delivering an end-to-end digital solution for dealers further strengthening its commitment to growing the market.

The national launch of Apply Online which offers e-sign capability means customers can calculate the finance they need, receive immediate approvals and sign documentation at home or in showrooms ensuring that dealers remain in control.

Delivery of the end-to-end digital process has taken nine months since the launch of SCF’s online calculator in December and involved substantial financial and resource investments at SCF.

The calculator has proved popular – customers have generated more than 4.1 million quotes and 51 dealers have signed up for the calculator. Apply Online, which was successfully tested over the past month, is now available to all dealers using the calculator.

SCF’s digital solution is integrated into dealers’ websites and installation takes minutes for dealers who already have the calculator. SCF is providing additional support to help dealers make the most effective use of the digital proposition.

The system is designed to provide a simple, fair and personal experience for car buyers and builds on the success of SCF’s partnership with Volvo Car UK launched in April.

Stewart Grant, Santander Consumer Finance Commercial Director said: “We’ve worked hard to design a market leading end-to-end digital solution which ensures   dealers retain control of customer relationships while benefiting from our brand power.

“The financial investment and the time spent by our team in developing and delivering the digital transformation emphasises how committed we are to support our dealer network in maximising sales and profitability within the growing digital market.”

Dealers interested in using the calculator or wishing to register interest in the Online Application platform should contact their Business Development Manager or visit: www.santanderconsumer.co.uk/dealer

R&D tax relief
FundsTransactional and Investment BankingWealth Management

Capital on Tap Celebrates the Milestone of Lending Over One Billion Pounds to Small Businesses

R&D tax relief

Capital on Tap Celebrates the Milestone of Lending Over One Billion Pounds to Small Businesses

 

In seven years from creation, the fintech company Capital on Tap, celebrates a major milestone of lending over 1 billion pounds to more than 65,000 small and medium enterprise businesses across the UK. 

By 2018, Capital on Tap had lent £500m to small businesses, and in the short timeframe that followed to September 2019, has now doubled this number to hit the milestone of £1bn. The quick, two-minute online application has drawn-in customers from various industries who praise the lending service for its ease of use. 

The one billionth pound customer Elaine Speirs, founder of Speirs Consultancy Ltd in biopharmaceuticals, said: “It was very easy, very fast. I don’t remember having to have a conversation with anyone, and I got my credit card within a couple of days.”   

“The app is really easy to use on my phone, and there’s a website where I can track all payments; it’s just very simple, I don’t really have to think about it.” Elaine continued that “my own bank turned me down as I was a new business, and without even applying for a loan – that was after 25 years of banking history with them, which I was quite taken aback by.” 

The Capital on Tap ‘soft searching’ function is ideal for new business owners as it allows customers to find out if they’re eligible for a loan without impacting their credit score. This method challenges typical lenders and empowers customers, particularly benefiting those in rural parts of the UK who could suffer approval delays of up to three weeks. In addition, once the Capital on Tap fund is agreed; the money is available online in a matter of minutes, streamlining the lending function and supporting those who may struggle with traditional lending platforms. 

Support given by Capital on Tap has been commonly found to facilitate travel, allowing customers to work internationally without charging any extras. Sean Swart, founder of PICS Consultancy Ltd, highlights that “I am often required to move around as part of my job and the Capital on Tap card removes stress around cash flow created by expenses, mainly those from travel expenditure which is created as a by-product of my job.” 

David Luck, CEO at Capital on Tap, commented: “We started Capital on Tap in 2012, with a mission of making it faster and easier for small and medium enterprises to obtain working capital. Since lending money to our first customer back in 2013, I never thought we would have lent over £1bn to more than 65,000 small businesses in just seven years.” 

“We have worked to develop a lending platform that not only makes funding easier for small businesses, but also provides a service for traditional banks. Not only do we pride ourselves in supporting small businesses in the main cities, we provide a unique service for those in provincial areas, where traditional banks fall short.” 

For more information, visit the Capital on Tap website: https://capitalontap.com/

The importance of sports to the UK economy
ArticlesBankingFinanceFunds

The importance of sports to the UK economy

The importance of sports to the UK economy

The importance of sports to the UK economy

 

There’s no doubt that the summer of 2018 will be difficult to top! With an uncharacteristically hot summer making for the perfect backdrop to all the barbecues we ever dreamed of, alongside an unpredictably fantastic performance in the World Cup for the English football team that single-handedly boosted the nation’s spirits even further, it was by all accounts a cracking summer. 2020 is set to bring us another worldwide celebration of sport with the Olympics in Tokyo, so you’d be forgiven for thinking 2019 might end up being something of a lull for the sporting world to recharge.

Not so. In fact, some news correspondents are forecasting another great year for UK sports. In particular, cricket is set to be the focus of the year while men’s football takes a backseat, as both the Cricket World Cup and the Ashes series are to be held in England.

Even a ‘quiet’ year has so much going on in the sporting world then. With that in mind, just how integral is the sporting industry to the overall UK economy? In this article, we will cover how the sporting industry supports the UK both in a financial capacity and beyond.

Input to the economy

If you’re not into sports (and perhaps even if you are), the wages enjoyed by sporting professionals might seem ludicrous. In particular, the six-figure weekly wages of top-league football players is a point of contention for some. What are we, as a nation, getting in return for such a cost?

Well, beyond the enjoyment of watching sport, the industry supports a huge part of the UK economy. According to CareerBuilder, the sports industry tallies up a whopping £23.8 billion annually for the economy. Let’s put a little context on that figure with a look at other contributors to the economy. The tourism industry, which the sporting industry technically supports as well thanks to the number of sports fan tourists seeking out games to spectate, brings in £24.5 billion for the economy every year.

Meanwhile, the Royal Family brings in around £1.8 billion to the UK economy each year, depending on the number of royal weddings of course! But this is outstripped by even one single contributor of the sporting world, with cycling drawing in £3 billion each year on its own. It’s a clear contrast that shows just how important the sporting industry is to the nation’s economy, standing toe-to-toe with the tourism industry.

Input beyond finances

Naturally, the sporting sector brings in benefits for the UK beyond financial too. There’s the sense of community it fosters, such as the nationwide burst of pride we all felt, sports fans or not, when England performed so well in the World Cup! This sense of social value also extends to supporting skills outside of sports — for example, numeracy skills in underachieving young people were seen to increase by 29% when becoming a regular sports participant.

Then, there’s the employment side of things. The sporting industry supports over 400,000 full-time positions in England alone.

Plus, there’s the obvious health factor. Participating in sports, which is undoubtedly spurred and motivated in many ways by fans looking up to athletes they admire, brings a much-needed boost to the nation’s health.

Protecting the commodity

The pitches

With such a strong presence in the UK’s financial stability, what is being done to ensure our sports capabilities are world-class? Well, for one, we have to maintain the best venues for both the players and spectators! A poor pitch can have a huge impact on the game it is hosting. Take Euro 2016, for example: while that year’s unusually wet summer left the French pitches in a terrible state, the UK’s football pitches were kept in prime condition. Of course, wet weather is the very foundation of which groundkeepers are experienced in here in the UK! With hybrid turf technology, undersoil heating, and pop-up sprinklers, our fields are ready for any eventuality. Keeping the soil warm ensures the grass doesn’t fall into its dormant, brown hue and stays green all winter.

As well as keeping the grass warm to avoid it going dormant, adequate draining is also needed to keep the grass from succumbing to the usually damp and dreadful British weather. One such method utilised by football pitches is pipe and slit drained pitches, which consists of a layer of firmed topsoil, stone back-fill, subsoil, and a perforated plastic pipe, along with a slit drain and sand blinding layer to allow water to drain down and away.

Sports funding

Of course, it’s not just football being maintained to such a high level. Thanks to UK Sport investing in a range of sports with money from the National Lottery and Exchequer income, other sporting disciplines are also flourishing on UK soil.

Particularly with the run-up to the Tokyo Olympics in 2020, current funding is generous indeed. Example figures include £29,624,264 to cycling, £9,838,913 to taekwondo, and £16,457,953 to gymnastics.

The world of sport is hugely beneficial to the UK, in terms of economy and society. The sector sees a huge amount of funding and manpower, but for good reason, with the industry bringing in so much and putting the UK in the global eye as a key sporting participant.

Climate strikes
FinanceGlobal ComplianceNatural Catastrophe

Climate change transforms high finance’s relationship with society

Climate strikes

Climate change transforms high finance’s relationship with society

 

Extinction Rebellion’s city centre disruptions and Fridays for Future’s well attended school strikes across Europe inspired by Greta Thunberg have placed climate change firmly in the public consciousness. Now more than ever before, the question is not if something should be done, but when and how. Robert Blood, managing director of NGO tracking and issues analysis firm SIGWATCH, explains how this is already forcing the financial sector to take more decisive action.

In June 2018, Legal & General told Japan Post Holdings (JPH) that it was dropping the company from its $6.7billion Future World index funds. It added that any of its funds that still held shares would be instructed to vote against the re-election of JPH’s chairman. L&G justified the move by saying that JPH had “shown persistent inaction” to address climate risk.

L&G is not alone in taking action on climate risk. BNP Paribas, AXA, Allianz, RBS, Munich Re, ING, Rabobank, Standard Chartered, Barclays and HSBC are all now committed to exiting deals and investments concerned with coal mining and coal-fired power. In the U.S., despite (or arguably because of) an administration that is openly sceptical of the need for climate action, many of the largest banks including JP Morgan Chase, Bank of America, Wells Fargo, Citi, Morgan Stanley and Goldman Sachs have all announced coal exits, as they have begun to do in Australia. Japan’s largest banks and insurers, and their equivalents in Singapore and China, have come late to the divestment game but they too are finally rolling out new coal pledges.

Revival of campus activism

These moves are the consequences of growing pressure from stakeholders, driven by activist groups, for almost ten years. It was in 2013 that US student environmental groups first demanded college endowment and pension funds sell off their shares in fossil fuel-related projects. Their carbon divestment campaign was modelled on the Apartheid campus divestment battles of the 1980s, which aimed to undermine the economy of South Africa by forcing U.S. firms and investors to sell off South African assets. Congress imposed investment bans too. Until the Klerk-Mandela settlement of 1993, South Africa was for almost a decade a pariah state for investors.

While the priority for campaigners has been to drive out coal, the pressure on carbon does not stop there. Under the slogan, ‘extreme carbon’, campaigners have extracted concessions from leading financial institutions on Canadian oil sands, Arctic and deep-sea drilling, shale gas, and related infrastructure such as LNG terminals and pipelines. As these specific sources become demonized, conventionally produced oil and gas becomes more and more dubious. Divestment on the basis of increased risk has a tendency to become a self-fulfilling prophecy. When money flows out of an asset type, the remaining investors are by definition exposed to increased financial risk, and this in turn stimulates additional cycles of divestment. There is a reason why fossil fuels are commonly described by climate campaigners as ‘stranded assets’. Even giants like Shell are now openly reconsidering their futures.

The success of campaigners in getting their arguments heard and taken seriously is a relatively recent phenomenon. In fact, one of the most striking developments in the financial sector of the last decade has been the ‘mainstreaming’ of environmental and social responsibility standards in investing. Until relatively recently, these were the preserve of SRI and ethical funds, often funds that had been set up at the behest of well-funded environmental groups who insisted on strict exclusion criteria.

Now, environmental and social governance (ESG) is embedded in standard fund management practice, helped by pressure from political stakeholders and customers, particularly in relation to the institutions’ own funds, to take intangible risks such as human and indigenous peoples’ rights seriously.

Financial institutions’ increased willingness to listen

The financial crisis of 2008 also played an important part. With the reputation of the financial sector in tatters, leading institutions made a conscious decision to prove their ‘value to society’ by adopting ESG, and engaging with NGOs in a far deeper and more open way than ever before.

Campaigning NGOs have not been slow to exploit investors’ new-found willingness to listen, to push their wider agenda on a wide range of environmental and social concerns. These include human and indigenous rights, sustainability, corporate environmental responsibility and benchmarking, labour standards, animal rights, even the ethics of investing in industrial scale agriculture.

As NGOs become more active and more influential, their campaigning can provide an early warning system for emerging issues for investors. On plastics and shale gas (fracking), campaigning levels rose significantly ahead of public concern, anything up to 12 months prior. This is not very surprising, since activists are effective at getting media attention and this feeds into public awareness. We are now seeing this with ‘green vegetarianism’ – the switch away from meat for environmental reasons like deforestation and climate change (see chart 1). All these correlations show how campaigners can ‘make the weather’ politically.

It will become more important for global financial institutions, as they develop ever more expansive policies and standards under pressure from NGOs and other stakeholders, to track the long-term implications of the criteria they are enforcing.

Pension funds linked to ‘politically sensitive’ workforces such as public sector employees, health and education, are especially vulnerable to this kind of pressure. The campus campaigns of the carbon divestment movement quickly moved on to targeting staff pension funds once they secured the support of a significant number of faculty. In Denmark the state pension funds have been called out by Greenpeace on the same issue. In Sweden, Greenpeace launched a boycott of payments into the mandatory state pension scheme AP3 until it agreed to divest from all fossil fuels and related infrastructure projects.

ESG goes mainstream

With leading financial institutions engaging seriously with campaigners and their concerns, doing nothing is not an option. As more major mainstream funds are managed on ESG principles, investment managers and institutions increasingly have to justify to their peers why they are not doing the same, rather than the other way round. It is no longer a question of, Are the NGOs being fair, but rather, Do the NGOs have the ear of our stakeholders, and are they already influencing rival institutions? They may be small and apparently insignificant compared to a bank or investment fund, but NGOs have become critical players in transforming what society expects from finance.

Robert Blood, managing director of NGO
Robert Blood, managing director of SIGWATCH
stocks
ArticlesStock Markets

What should a business on the world’s first stock exchange focused exclusively on impact investment look like?

stocks

What should a business on the world’s first stock exchange focused exclusively on impact investment look like?

 

• Project Heather launches consultation at UN Climate Action Week
• Consultation on a new proposed ‘public markets impact issuer model’ is welcomed by Jamison Ervin of the UN Development Programme as “a significant step towards achieving the Global Goals”
• Truly collaborative approach to consultation appeals to the global community of impact experts to solve how business can achieve UN Sustainable Development Goals within a new systemic framework
• The proposed Scottish-based, global facing, impact-focused stock exchange would be the first recognised investment exchange in the world to mandate the annual reporting by issuers of the social and environmental impact of their business

Project Heather has announced the opening of a consultation, presenting its suggested elements for what an ideal issuer on its exchange might look like, including the core pillars required to support impact reporting by its issuers. The consultation will feed into the Impact Reporting Requirements for the proposed Scottish-based stock exchange. Speaking ahead of the UN’s Climate Action Summit at the UNDP’s Climate Hub, Project Heather CEO and Founder Tomás Carruthers declared the consultation open, in an impassioned call to action to the impact and sustainability communities.

Tomás Carruthers, CEO and Founder of Project Heather, said: “It is an honour to launch this consultation at the United Nations Development Programme’s Climate Hub as the world’s nations come together for Climate Week.

“Our mission at Project Heather is to make the Sustainable Development Goals, and beyond, feasible and achievable. Project Heather integrates the routes most likely to move capital at the greatest speed and scale to the kinds of projects that most urgently address risks to stakeholders captured in the SDGs. As a Project we have spent considerable time working on what a potential issuer on our proposed new Scottish stock exchange might look like, but now it is time to call on the global impact community to help. We invite them to join our consultation and hold us to account. This is a call to act now – we don’t have much time left to achieve the SDGs.”

Jamison Ervin, Global Manager on Nature for Development, UNDP, said: “It is now widely acknowledged that the Global Goals cannot be achieved without private sector support, and while impact investing is growing in some sectors, it is yet to penetrate capital markets. In seeking to change how capital markets value natural capital, we see Project Heather’s goals for an impact-focused stock exchange as a game-changer for our planet.”

The proposed Scottish-based, global facing, impact-focused stock exchange will be a stock exchange built specifically for impact investments, defined by the Global Impact Investing Network as those “made into companies, organisations, and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return.” The proposed new exchange, being built by Project Heather, is designed to make a positive impact on society and our global home. This will be achieved by managing, measuring and reporting the impact of the issuers on it against the targets of the Global Goals.

About the consultation

The proposed Scottish-based stock exchange will require impact reporting for every issuer on admission and annually thereafter. In building the operating model and frameworks for the new exchange, Project Heather has identified the Sustainable Development Goals as the destination framework, with every issuer required to report against the goals, and critically, the goals’ targets. The consultation seeks opinion on this chosen destination.

In addition, the consultation will also gather input on seven key elements it believes underpins the impact reporting requirements of an issuer:

1. The issuer’s board declares that its organisation’s core purpose is to make a positive impact, as defined by the Principles for Impact Finance to provide a definition of value which goes beyond profit, to include social and environmental well-being. This defined purpose is contextualised to align with global goals for sustainable development.

2. This declared purpose is clearly articulated through a theory of change.

3. This declared purpose is realised through the material core of the issuer’s activities, and the issuer commits to a proactive journey towards value creation within the entire system it operates.

4. Impact is measured using widely accepted frameworks and tools and must include measurement against the SDGs.

5. Impact is reported publicly and annually, with a commitment to ongoing improvement.

6. The organisation or issuer is committed to transparency.

7. The organisation or issuer is committedly against impact-washing.

Project Heather neither seeks to create a new impact tool or impact reporting framework, nor will it prefer any one existing impact measurement or management tool or framework. As part of the consultation process, Project Heather hopes to engage with the ecosystem of recognised and respected frameworks that exist for measuring, managing and reporting on social and environmental impact, both established and emerging.

In addition, Project Heather will seek to understand what the global impact community believes a business on the exchange should constitute and what segments should be avoided, if any. As transparency of information, both at listing and thereafter, is a reason Project Heather believes capital markets can transform impact investing, the consultation will seek opinion on what that transparency should look like.

Those wishing to respond to the consultation should go to www.projectheather.scot and complete the form. The consultation will be open until Monday, October 21st, 2019. The draft reporting requirements will be published following consideration of the consultation responses.

Colin Price
BankingHigh Net-worth Individuals

Colin Price appointed Group Chief Operating Officer at KBL epb

Colin Price

Colin Price appointed Group Chief Operating Officer at KBL epb

 

KBL European Private Bankers (KBL epb), which operates in 50 cities across Europe, announced today the appointment of Colin Price as Group Chief Operating Officer and member of the Authorized Management Committee, subject to regulatory approval.

Price – who has a 35-year track record of successfully advising leading companies worldwide on how to unlock their full potential – will oversee a wide range of support functions, including IT, Operations, HR, Marketing and Real Estate. He will personally participate in the group’s long-term success through a significant co-investment.

A former Partner at PwC and McKinsey who set up his own boutique consultancy in 2014, Price earlier served as CEO of Heidrick Consulting, a division of Heidrick & Struggles. He has also served as a Visiting Professor at Imperial College London and an Associate Fellow at Saïd Oxford, the business school of Oxford University.

Price, a British national, holds degrees in economics, industrial relations and psychology, and organizational behavior. He is the co-author of a number of books, including most recently Accelerating Performance: How Companies Can Mobilize, Execute and Transform with Agility.

In his new role, he will work alongside Eric Mansuy, who assumed the Group COO role last fall and has been named Group Chief Information Technology & Operations Officer, reflecting his areas of core expertise and reporting to Price.

Mansuy, who joined KBL epb in 2014 as Group Chief Information Officer, previously served as Chief Information Officer at RBC Investor Services. A French national who studied at the University of Lorraine and IMD Business School, he earlier held a number of senior roles in the IT department at Banque Internationale à Luxembourg, rising to the position of Head of IT Services.

“I have known Colin for many years, benefiting from his strategic insight as a trusted advisor,” said Jürg Zeltner, Group CEO and member of the Board of Directors of KBL epb, where he has taken a significant ownership stake.“I am delighted that he has joined our group’s leadership team as a full partner in this journey.

“Together with Colin and Eric – who has demonstrated his ability to tackle the most complex technological and operational challenges – we will move forward rapidly and with purpose, cutting through complexity to deliver even greater value to every client we have the opportunity to serve.”

“After spending a lifetime studying why companies succeed and advising countless firms on how to perform better, I’m grateful for the opportunity to all put my insight and experience to work for KBL epb,” said Price. “At this transformative moment for the group, we’re focused on effecting rapid, positive change that will make this an even better bank for our clients and our people.”

“I’m very pleased to be able focus more sharply on shaping IT and Operations strategy, working closely with Colin and team leaders across our footprint,” concluded Mansuy, who has successfully overseen the group’s migration to an enhanced IT platform, among other major projects.

CAR INSURANCE
ArticlesFinanceInsurance

Six of the best ways to reduce your car insurance

CAR INSURANCE

Six of the best ways to reduce your car insurance

 

Are you aware of all the ways you can potentially reduce your insurance outlay? Here, we look at the biggest contributing factors.

We all know that cars can be expensive — and not only to purchase. There are many extra charges that you may face as a car owner, including MOT charges, road tax and fuel allowance for things like your daily commute.

There are also the hidden costs to consider if your vehicle unpredictably breaks down. However, one of the biggest expenses you’re likely to face is your annual insurance just to drive your car. In Britain, there are over one million uninsured drivers on our roads, which in turn increases premiums for those who do insure their vehicles.

For many people, a yearly payment is too big of a lump sum, so they must break it down into monthly payments. But, are you aware of all the ways you can potentially reduce your insurance outlay? Here, we look at the biggest contributing factors.

Shop around

It goes without saying that it’s important to consider your options. Like any service, you should do your research. Many insurance companies will attempt to ‘better’ the offer on the table by a different provider, so be sure to know what you want and don’t just settle with the first, or your current provider. However, remember that cheaper isn’t always better. Check what is included before agreeing to a cheaper cover.

Reduce coverage on older cars

While you may be tempted to always choose comprehensive cover for your vehicle, be aware that choosing this coverage for particularly old vehicles may not be cost effective. For example, if your car is worth £1,000 and is in a crash, there’s a possibility that your insurer will just write your vehicle off. Therefore, if your insurance is costing approximately £500 for comprehensive cover, it may not make financial sense to purchase it. Comprehensive cover is most cost effective for those with new cars, or cars that have held their value.

Have a solid credit score

Having no claims bonuses are obviously a great help when it comes to lowering the cost of your insurance. But, were you aware that your overall credit score can also have a huge impact on your car insurance? That’s because insurers take in the impression that if you’re responsible in your personal life and with other financial situations, you are less likely to file a claim.

Include a black box monitor

Some insurers will lower the annual cost of your cover if you fit a small box in your car that can help insurers to track your driving methods. This will include aspects such as braking and speed via GPS, as well as taking into account the time of day you drive. This method, also known as telematics insurance, is effective for young and inexperienced drivers, those who have a low annual mileage, or older drivers who want to prove that they’re safe behind the wheel.

Add other named drivers

It may seem strange that more drivers being named on your insurance will bring down your costs, but that’s the case for many quotes. This is because it helps the insurer tie more people into their service. This works well for younger drivers who would usually be charged an extortionate amount. Being named on their parents’ insurance can help reduce their outlay.

Increase your excess

Your premiums are based on how much your insurer is likely to pay out if you claim. By choosing to pay a higher voluntary excess, you will lower the cost of what the insurer will have to pay towards the claim. Therefore, this can lower your overall insurance. However, you must ensure that you choose an excess you will be able to afford and make sure the excess doesn’t exceed the overall value of your vehicle.

While it’s a necessity to be insured when on the road, you don’t have to pay over the odds to do so. Following the above guidelines can help you reduce your overall payments — leaving you with extra money to spend elsewhere.

gender equality
Wealth Management

In wealth management, better gender representation is better business

gender equality

In wealth management, better gender representation is better business

 

By Sofija Djapic, Business Development Manager, InvestCloud

Last year, more than half a million people took part in a survey conducted by the University of Cambridge that explored psychological differences between the genders. One of the long-standing psychological theories that it proved is the Empathising-Systemising theory of gender differences. Essentially: on average, women score higher on tests of empathy, and men score higher on tests of systemising, also known as the inclination to analyse.

No matter the gender, a good financial adviser is one who can empathise with their clients. Advisers who take the time to listen, understand long-term goals, and tailor advice to clients’ individual needs are those who will build strong relationships with clients and have a high retention rate. As we well know, women make excellent financial advisers, just look at Forbes Top Women Wealth Advisors 2019.

Yet while women make excellent financial advisors, women’s financial risk is increasing. The Chartered Insurance Institute (CII) also recently examined the rising levels of financial risk facing women in the UK. The conclusions are dismal. Women today are “less likely to accumulate wealth over the course of their lifetime than previous generations.”

It states that while women live longer than men, they are saving less. This is due to pay inequality and career breaks to care for families, children, and parents. Women in the UK face a significant pension deficit compared to men. By the age of 65, the average woman’s peak pension wealth is £35,700, one fifth of an average man. Longer life expectancy means the average cost for women entering a care home at age 65 is £132,000. Again, this is nearly double the same cost for a man.

These two issues create one difficult question for the wealth management industry: is it at risk of failing women?

 

Where does the problem originate from?

This issue is not unique to wealth management. The entire financial industry faces this same issue.

Representation is a huge factor in the entire financial industry – both from a client and an advisor perspective. Only seven percent of investment funds in the UK have a woman as the named manager or co-manager. This issue goes to the heart of a wealth management practice – down to the bottom line. A study by Ernst & Young found that 73 percent of female wealth management clients in the UK felt wealth managers misunderstood their goals and could not empathise with them. This has serious repercussions for client retention and acquisition.

Why? Because the number of financially powerful women is rising rapidly. There are many more to come from younger generations – especially with the coming wealth transfer.

This is a demographic that wealth management firms need to think seriously about. Currently, wealth managers are ostracising half their future potential client base. To attract these investors, wealth managers must change how they are perceived.

 

True representation, real empathy

If we aren’t seeing proper representation within the industry, how can we expect that services will be tailored to address the unique needs and circumstances of women? And how can we expect firms to appear welcoming and inclusive to potential clients?

Firms must make a concerted effort to hire financial advisers that clients can relate to. This requires a diverse culture. This not only means hiring more women, but also hiring advisers who are younger and come from different backgrounds – culturally and economically. This must go beyond gender-washing or tokenisation to deliver real value; this way wealth management firms can change how they are currently perceived by women and how they understand the needs of their female clients.

Having female advisers in a firm helps to integrate a greater understanding of the unique needs women have in trying to maximise their wealth. Financial advisors are already experts at delivering personal engagement. By improving upon their knowledge of women’s unique priorities, advisers will develop deeper relationships and increase trust.

To tailor these services to women, they must be built on empathy. For an increasingly younger and more tech-savvy demographic, this must also manifest as digital empathy. If a firm can translate its ability to deliver truly personal services into a digital environment, they will see massive benefits when it comes to onboarding women. This is done, as the EY study discusses, by improving micro-segmentation capabilities that in turn create more tailored client experiences that acknowledge women’s formal and informal goals, as well as their “soft preferences.”

Firms can augment this by employing behavioural science functions to design individual client experiences. This is done by harnessing client data. This data is used to inform the digital experience and improve digital empathy. It is gathered at all points – from how many times a client logs in to the platform, to what they view and the information they offer up. Data needs to be used to map out the client’s journey, ensuring that the adviser can anticipate needs and effectively service the client.

Digitising services opens opportunities to create empathetic relationships with clients in more ways than just data collection and analysis. Advisers can free up valuable time through automation and spend this time building their clients’ portfolios. It also means they can scale up to service more clients, without negatively impacting quality of service.

Balancing this digital empathy with face-to-face empathy is a winning combination for the next generation of investors.

 

Future-proofing the bottom line with representation and digital empathy

Digital platforms allow advisers to help clients navigate through turbulent times early. This further establishes trust – achieved through pattern recognition and prescriptive analytics, along with enhanced early warning indicators through automated monitoring of client data and alerts.

Implementing these changes will benefit all clients but will have the most immediate and profound impact on a firm’s female clients. This is because women can feel seen, heard and represented when it comes to making some of the most important financial decisions in their lives. This feeling can then be augmented into the everyday interactions through digital services.

This is how the industry can turn around the female experience: empowering our female clients within businesses and within the client base. The positive effects this has on the bottom line will quickly become obvious.

houses
FundsPrivate BankingReal Estate

Two Thirds of Buyers are Struck With Anxiety Fighting the Challenges of Buying Their First Home

houses

Two Thirds of Buyers are Struck With Anxiety Fighting the Challenges of Buying Their First Home

 

This year, reports revealed that first-time buyers (FTBs) account for more than half (51%) of the nation’s buying market for the first time since 1995 and with the average deposit for a first-time home now sitting at £33,000, today new research has revealed that mortgages have as much impact mentally as they do financially on first-time buyers.

According to a survey of 2,000 FTBs currently in the market for a home, commissioned by online bank Atom bank, two thirds (64%) have admitted to feeling anxiety when tackling the challenges of getting a mortgage and purchasing their first home.

A lack of education around mortgages is playing a huge part in buyers’ anxiety. Of the 64% of buyers who have felt anxious whilst looking for a house, a massive three quarters (74%) attribute being unsatisfied with their knowledge of mortgages as a key factor.

The process has become so overwhelming for some, that over a third (37%) of buyers recently considering purchasing a new property have pulled out due to the stress of it all.

3 in 5 (58%) admit that a key contributing factor to their high stress levels is saving for a large enough deposit. Though the stress is not limited to those on a lower income, as almost half (47%) of households earning more than £80,000 a year have said they’re struggling to save for a deposit. This is in spite of the fact they’re earning nearly three times the national average wage (£29,009).

Mortgage Complexity and Mental Health

The research reveals the complexity of the current mortgage process is causing first-time buyers to doubt whether mortgage companies actually understand the challenges modern buyers face.

More than 7 in 10 people (72%) who are anxious about the challenges of purchasing a home don’t think that mortgage companies fully comprehend the challenges buyers face. The consensus is heightened by the fact that more than three quarters (78%) of the nation believe the mortgage process is too complex and needs to be more consumer-friendly. More than a third (37%) of buyers – from builders to barristers – with a postgraduate degree feel dissatisfied with the mortgage process and with 7 in 10 (70%) of Brits looking to move in to their new home this year still feeling anxious about the prospect, the mortgage process proves to be daunting from start to finish.

The challenge is too much for one person’s shoulders, as a fifth (21%) of buyers going through the mortgage process by themselves have had to pull out due to stress, compared to only 6% of those going through it with at least one other person. This still takes its toll on those in a relationship, as two thirds (65%) have claimed that although they haven’t pulled out of the market, the process has given them anxiety.

Spend or Save: Where does all the money go?

The turn of the 21st century has brought a new challenge for millennials trying to save for a deposit. The average person spends £1,740 a year on amenities such as streaming and on-demand services, phone bills and electronic devices. Modern technology has also made travelling much more accessible, with the average person spending £1,152 a year on trips. Combining the two means the average person spends £2,892 a year on both exploring and everyday tech, which is more than 1% of the average UK house price (£230,292).

In efforts to balance the books, nearly half (46%) of buyers would be willing to move back home with their parents to save money. Higher earners are the most likely to move back home, as nearly half (47%) of those earning over £34,000 would move home to save money for a deposit, compared to 2 in 5 (39%) people earning under £34,000.

However, those living by themselves (69%) and former university students (53%) are least likely to move home, despite 3 in 5 (60%) students claiming that saving for a deposit is their biggest obstacle, as well as paying off their university debt which is on average £50,800.

 But moving home is just the start for some, as 2 in 5 (38%) of buyers admit that their only way of saving a large enough deposit is through financial support from either a family member or partner. The reliance on family help grows with the buyer’s age; Generation X are twice (26%) as likely as millennials (13%) to ask for financial help when they’re trying to buy.

Despite a double income, two thirds (65%) of those in a relationship say that the biggest obstacle they face is saving for a deposit, compared to half (50%) of singletons. Having children stretches finances further, as 2 in 5 (38%) buyers rely on financial help from their family or partner, compared to 1 in 5 (22%) of those without children.

Stick or Twist: Flying the nest

Over a third (37%) of FTBs look to buy in the same area they grew up, with a quarter (25%) stating that they will look to buy somewhere that’s close to their friends. Traveling may give millennials the confidence to buy a new home in the unknown, as a quarter (25%) look to move away from the area they grew up in to experience some where new, while only 1 in 10 (10%) of generation X are willing to move away from their childhood area to try something new.

A key factor behind many buyers’ move is their job as a quarter (26%) look to buy a property closer to work. Many buyers looking to change jobs are caught in a predicament, as 2 in 5 (38%) look to buy somewhere that will give them better job opportunities, but nearly half (46%) are struggling to save the deposit they need to get in to those desired areas.

 

Education, Misconceptions and Help

Millennials believe knowledge is key, as 1 in 5 (19%) stated that a lack of education is the key reason behind the stress issues for first time buyers, whereas only 1 in 13 (8%) people from generation X believe a lack of education is to blame.

The process starts with confusion, as 43% of people found it complicated to choose a company or mortgage broker to get the ball rolling, while two thirds (63%) of buyers have stated that choosing a mortgage type is the most complicated part of the process.

Half (51%) of buyers who recently pulled out of the market explained that having their documents in order was the most stressful part of the process, with their little knowledge on key terms being a key issue.

The research has revealed the most common words in the mortgage process that buyers had either never heard of or didn’t understand are:

Highest percentage of words that were never heard of

Over half the nation (52%) wish they’d been taught more in school about the mortgage process. Worryingly, almost as many people would seek mortgage advice from a parent (55%) as they would a professional (57%), despite the abundant challenges new buyers face.

The lack of education on mortgages has left buyers unaware of multiple schemes that can help first-time buyers get on the property ladder. 4 out of 5 (83%) buyers with children have never heard of a ‘Family Offset Mortgage’, over a third (37%) have never heard of the ‘Right to Buy’ scheme and nearly 4 in 5 (78%) are unaware of the ‘Starter Home Initiative’.

Mark Mullen, CEO of Atom bank, said: “Today’s findings have showcased just how much impact the mortgage process can have on a first-time buyer, before they’ve even entered the market.

“Buying a home is commonly the largest investment most people will make in their life time, which is stressful enough without worrying about the mortgage process. This makes it vital that buyers feel at ease from as early on in the process as possible. The results show that there is a real disconnect between advisors and buyers, as many people are seeking advice from their parents, who may have not purchased a property in decades.”

bitcoin
Due DiligenceFX and Payment

Leading UK tax and business advisers BKL to accept Bitcoin as fee payment

bitcoin

Leading UK tax and business advisers BKL to accept Bitcoin as fee payment

 

The London and Cambridge-based charted accountancy firm BKL, is believed to be the first UK mid-sized accountancy firm to accept a cryptocurrency to settle invoices. BKL specialises in helping entrepreneurs, high net worth individuals and owner managed businesses across a range of business sectors. These include technology, financial services, property and farms and estates.

“As a forward-looking business, we are always exploring new ways to develop our offering. We are pleased to now offer this option to clients,” said Jon Wedge, Financial Services partner at BKL.

“We support people and businesses that work with cryptocurrencies and blockchain, and this move has been driven by demand from our clients. It’s a convenient way for many of them, particularly those in the fintech and technology sectors, to buy our services.”

Using a leading automated payment processing system, BitPay, clients of BKL can now opt to receive invoices in Bitcoin. 

“BKL are one of the most respected specialist accountancy practises serving the blockchain industry and we are very happy that they are successfully using BitPay’s B2B service” said Sonny Singh, Chief Commercial Officer of BitPay.

“This is another superb example of forward thinking professional service businesses engaging with the ever-expanding crypto currency industry.  As blockchain ventures continue to proliferate there will be an increasing worldwide demand by vendors to pay invoices in bitcoin.”

BKL will invoice their clients with a traditional fiat value, and then the client pays in bitcoin or bitcoin cash with a conversion rate provided by BitPay that is issued and fixed for 15 minutes, using an average price from leading regulated exchanges. This ensures there is no exposure to any of the price volatility that characterises the digital currencies.

BKL receives its payment electronically through BitPay, but as fiat money.

wealth management
Corporate Finance and M&A/DealsHigh Net-worth IndividualsWealth Management

Report calls for major digitisation of the wealth management sector but warns 84% of projects could fail

wealth management

Report calls for major digitisation of the wealth management sector but warns 84% of projects could fail

Over £20 billion of high net worth individuals’ investable wealth could be passed on to their loved ones every year, but as many as 80% of wealth manager’s don’t have an existing relationship with these beneficiaries. Digitisation is key to addressing this challenge.

A new report from Nucoro, a B2B fintech providing Wealth Management as a Service solutions, says traditional wealth managers need to totally re-engineer their operations if they are to prosper in the future. However, it warns that on average around 84% of companies generally fail at digitisation projects. 

The report entitled ‘The Future Challenges for Wealth Management’, says wealth managers and financial services companies in general need to prioritise and redefine what can be expected and achieved from digitisation, and make increased use of partnerships with expert solution providers.  

Nucoro says the digitisation of the wealth management sector needs to go beyond simply moving physical into digital, and fundamentally rethink products from the conceptual to execution. It says this is being driven by the rise of automation facilitating scalable growth, and the transformation of customers where their expectations, needs, behaviours and demographics are changing.

To illustrate this point, Nucoro estimates that on average, for the next decade over £20 billion of high net worth individuals’ investible wealth will be passed on to their loved ones every year, but as many as 80% of wealth manager’s don’t have an existing relationship with these beneficiaries. Many of these beneficiaries will be millennials who make great use of technology in all aspects of their lives, including managing their finances.

Nikolai Hack, the COO and UK MD of Nucoro commented: “As with any investment in a financial business, a central motivation should be to ultimately produce outcomes that can benefit customers. Adopting bolt-on enhancements like digital customer experiences or automations for back office functions are the best routes to upgrading the services to existing and potential clients due to their accessibility, scalability and affordability.” 

“Wealth managers must embrace technology. The industry is heavily regulated, and it therefore faces a large administrative burden, but technology can minimise the time and resources spent on tasks that are very basic but high in volume.”

The report highlights several key trends that innovative wealth managers need to address if they are to be successful in the future:

The growth of digital wealth management:

The report says it is now realistic to consider direct to consumer robo-platforms as legitimate industry challengers. By the end of 2018, they were managing $257 billion, and this could grow to $1.26 trillion by 2023. 

The rise of fintech new entrants:

While tradition still reigns supreme in wealth management, there are major indications that the next decade will see technology driven services enjoy strong growth. Taking an example from another industry, looking at the banking and payments market in Europe – new entrants (including challenger banks, nonbank payment institutions and big tech companies) that entered the market after 2005 now amass up to one third of new revenue, despite only taking 7% of the overall revenue.

Growing advice gap:

The cost of financial advice is demonstrably pricing out large sections of potential clients. A report in 2018 found that more than 40% of financial advisers has been forced to review their charging structures in the first half of 2019. This is a huge threat and opportunity for wealth managers

Wealth passed on to millennials/changing client needs

Beginning around 2030, an estimated $4 trillion of wealth is going to be passed on to millennials in the UK and North America from their parents. However, only some 20% of UK advisers currently have an existing relationship with their current clients’ beneficiaries, many of whom are millennials. This means that digital and mobile first access will become more universal as the younger generations mature. Digital finance is a highly effective engagement tool for younger generations.

Nikolai Hack said: “An unprecedented transfer of wealth is expected to be served by a shrinking pool of advisers. They will be dealing with a client base that is likely to need them to become more flexible and deliver a more modern and personal service.”

“This could mean more agile tech-driven firms will need to fill the gap. Alternatively, the existing firms could push to streamline their operational functions and manage overheads – cost cutting essentially – while handling an influx of orphaned clients at the same time.”

“For the next generation, their needs and expectations are centred on interacting with their finances via digitally accessible platforms that link their money, their everyday lives and their goals to the future. Greater customisation of service levels will also be key here.”

The reach of regulation

The number of individual regulatory changes that regulated organisations must track on a global scale has more than tripled since 2011. Tech can play a key role in helping wealth managers with this area of their business.

Conclusion

Nikolai Hack said: “For wealth managers, technology and digitisation can be applied across all functions, from onboarding clients and portfolio management to operations and reporting. It also enables wealth managers to become much more agile and focused on the needs of clients. However, wealth managers need to find the right balance between digital and human services and the key to success will be how wealth managers combine these two in order to meet the challenges now and in the future.”

From client onboarding to portfolio construction through to billing automations, Nucoro combines all the tools required to build the next generation of wealth management propositions. To help the wealth management sector move forward, Nucoro offers a new technology-based foundation built without legacies – a complete overhaul to the models of client service and accessibility. Nucoro’s is a radically different approach to the relationship between technology providers and the organisations adopting their solutions – in short, they can provide the new engine to power the next generation of financial services.

Whilst Nucoro has recently launched to the public, the technology behind it powers the retail investment platform, Exo Investing – a fully automated, AI-powered wealth management platform. Within the first year of operation, Exo won two industry awards (Best digital wealth manager OTY + Industry Innovator OTY at the AltFi awards 2018), was named as a finalist in three more and selected to two disruptive company annual indexes (Wealthtech 100 and Disruption50’s 100 most disruptive UK companies).

Nucoro is making this technology available for businesses in the wealth management sector that have the ambition to truly innovate and future-proof their businesses – and are struggling to realise their digital ambitions alone.

bank
BankingCapital Markets (stocks and bonds)

How the finance industry has evolved

bank

How the finance industry has evolved

Industries are constantly trying to keep up with the fast-paced landscape in which they operate, be it technological changes, customer demands or simply just making things easier for their consumers.

But it is the speed at which the technological advancements have reached that has forced traditionally slow-moving financial institutions to heavily invest to remain relevant to their consumers and remain competitive in the marketplace.

Personal

Banking is one of the oldest businesses in the world, going back centuries ago, in fact, the oldest bank in operation today is the Monte dei Paschi di Siena, founded in 1472. The first instance of a non-cash transaction came in the 20th century, when charga-plates were first invented. Considered a predecessor to the credit card, department stores brought these out to select customers and each time a purchase was made, the plates would be pressed and inked onto a sales slip.

At the end of the sales cycle, customers were expected to pay what they were owed to the store, however due to their singular location use, it made them rather limiting, thus paving way for the credit card, where customers that had access to one could apply the same transactional process to multiple stores and stations, all in one place.

Contactless

The way in which we conduct our leisurely expenditure has changed that much that we can now pay for services on our watches, but it wasn’t always this easy. Just over a few decades ago, individuals were expected to physically travel to their nearest bank to pay their bills, and had no choice but to carry around loose change and cash on their person, a practice that is a dying art in today’s society, kept afloat by the reducing population born before technology.

Although the first instances of contactless cards came about in the mid-90’s, the very first contactless cards associated with banking were first brought into circulation by Barclaycard in 2008, with now more than £40 million being issued, despite there being an initial skepticism towards the unfamiliar use of this type of payment method.

Business

Due to the changes in the financial industry leaning heavily towards a more virtual experience, traditional brick and mortar banks where the older generation still go to, to sort out their finances. Banks are closing at a rate of 60 per month nationwide, with some villages, such as Llandysul closing all four of its banks along with a post office leaving it a ghost town.

The elderly residents of the small town were then forced into a 30-mile round trip in order to access her nearest banking services. With technology not for everyone, those that weren’t taught technology at a younger age or at all are feeling the effects most, almost feeling shut out, despite many banks offering day-to-day banking services through more than 11,000 post office branches, offering yet a lifeline for those struggling with the new business model of financial firms.

Future innovations

As the bracket of people who have grown up around technology widens, the demand for a contemporary banking service continues to encourage the banking industries to stay on their toes as far as the newest innovations go.

Pierre Vannineuse, CEO and Founder of Alternative Investment firm Alpha Blue Ocean, gives his comments about the future of banking services, saying: “Artificial intelligence is continuing to brew in the background and will no doubt feature prominently in the years to come. With many automated chatbots and virtual assistants already taking most of the customer service roles, we are bound to see a more prominent role of AI in how transactions are processed from all levels.”

Technology may have taken its time to get to where it is now, but the way in which it adapts and updates in the modern era has allowed it to quicken its own pace so that new processes spring up thick and fast. Technology has given us a sense of instant gratification, either in business or in leisure, we want things done now not in day or a week down the line.

BankingCash Management

The importance of teaching financial literacy in school

Finance

The importance of teaching financial literacy in school

Money can be a touchy subject. Many of us feel awkward discussing our finances, but when studies show that three quarters of Britons were worried about their finances in 2018, it becomes clear that we can’t avoid the topic for much longer. Over half of UK adults attribute money worries to mental health issues, and the ever-growing anxiety about money needs to be tackled head-on. The question is, what’s going wrong?

One answer is lack of education. Children rarely receive lessons on budgeting and money management. The sudden responsibility of having to manage their own money often shocks young adults when they become financially independent. Along with Business Rescue Expert, who specialise in company liquidation, we will delve into the importance of financial literacy… 

Why should we teach kids about finances?

Recently, certain financial topics have been added to the national curriculum. These include savings and investments, pensions, mortgages, insurance, and financial products. It’s still a relatively recent introduction to schools, so not all teachers may feel confident in teaching it yet, due to the specialised, complex nature of the topics. There is also the matter of religious differences in the approach to and teaching of these finance lessons. Followers of the Islamic faith are prohibited from using any form of compound interest. This relates to things like conventional mortgages, student loans and car loans, all of which are commonplace in many other cultures.

Because of these factors, there are many difficulties when it comes to making financial literacy universal, understandable. Maths might seem like an obvious place to drop lessons of finance in amongst existing content, but debate is rife as to whether subjects like trigonometry are still deserving for a place on exam papers, when finance lessons could take their place and provide long-lasting life skills.

How are curriculum changing?

Life skills such as finances can be complex to teach in schools. Lessons in finance differ from core subjects like English and Science, as they provide life skills which, if not learned, will be detrimental as kids grow older and enter adult life. One UK primary school created its own bank, to combat ‘below average’ financial literacy learning.

Despite financial literacy being introduced to the national curriculum in England in 2014, not everyone believes that school is the place for financial education. Some believe the duty should be on parents to teach their children the real value of money and how to approach it. It’s worth noting that in private schools, faith schools, and academies, it isn’t a compulsory part of the curriculum, so many youngsters would still miss out on these lessons. A lot of schools who do incorporate it into the school day compartmentalize it into general ‘citizenship’ lessons, but it’s arguable whether enough emphasis is placed on it here.

What has changed in the ‘millennial’ era?

Judging by the results of countless studies, it is evident that millennials have large gaps in their knowledge about finance management. Millennials’ spending patterns stand in stark contrast to their predecessors; they’re keen to splash out on experiences and don’t often take to the idea of big commitment purchases seriously — for example, houses.

Millennial spending habits signify the disparity of their knowledge and attitude towards budgeting — research has found that 60% of these youngsters said they are willing to spend more than £3.11 on a single cup of coffee, while only 29% of baby boomers would splurge for caffeine. A lack of financial literacy in education has undoubtedly played a role in this, with many young people under the illusion that simply earning a lot of money means that you’ll never be in any debt, along with a general unwillingness when it comes to making sacrifices for the sake of budgeting.

One survey found that 42% of teenagers said that they wanted their parents to talk more about finances, and a staggeringly low 32% said that they knew how credit card fees and interest worked. Teenage years are pivotal points for learning, so why is financial literacy being left out?

Hopefully the future will hold the increased popularity of these lessons to remedy this lack of financial literacy. These skills will prove invaluable for youngsters as they progress through life, and they could eventually counteract the stereotype of a financially irresponsible or illiterate millennials.