Over half (56%) of UK SMEs believe that government investment is unevenly spread in favour of London, according to the latest SME Confidence Tracker from independent financial services provider, Bibby Financial Services (BFS).
The findings suggest UK SMEs expect more from the Government’s industrial strategy beyond London, as awareness of the Northern Powerhouse grew by 13 per cent in the year to over two thirds (70%) of SMEs. However, there remains work to be done to champion the Midlands Engine, where over half (54%) of SMEs are unaware of the initiative, despite renewed efforts by the Government to champion the region.
Highlighting further imbalances, over a third (36%) believe the Northern Powerhouse is too focused on Manchester and should look to develop other cities in the North, down from 40% in 2017. A similar situation exists in the Midlands, where nearly a third (28%) of SMEs believe the Midlands Engine is too focused on Birmingham and should be focusing on developing other cities in the region, down from 33 per cent in 2017.
When asked what they thought about the Northern Powerhouse, nearly a third (29%) of SMEs see it as an investment gimmick that is politically motivated. Just under a quarter (24%) believe the same of the Midlands Engine.
The figures follow the recent appointment of James Brokenshire, Secretary of State for Communities, as the ministerial champion for the Midlands Engine.
Edward Winterton, UK CEO, Bibby Financial Services said: “After decades of under-investment in the UK regions, a patchwork approach to investment is not delivering on the Government’s promise of a fairer economy. SMEs need better support to re-set the balance between the regions and provide business owners with the confidence to invest and grow.
“SMEs are doing their upmost to get on with things amidst Brexit uncertainty. It is about time the Government did the same. Brexit must stop being a distraction from a domestic agenda that needs to deliver for businesses and the people they employ. For starters, roads need to be built, internet speeds improved, and train lines electrified.”
The latest research also shows that confidence amongst UK SMEs declined from 50 per cent in Q1 to 42 per cent in Q2. Over half (55%) also think that uncertainty around Brexit is damaging the economy. A further 39 per cent of SMEs believe that the UK workforce lacks the skills to enable competitiveness.
Winterton added: “At the start of the year we saw a Brexit-bounce in confidence as SMEs saw signs of progress and tangible outcomes from the negotiations. Since then, developments on the Brexit front seem to be as dry as the UK’s weather. Lack of movement and squabbling within government means that SME confidence will continue to waiver.
“The latest fallout from Chequers and the resignations of Boris Johnson and David Davis is only going to fuel the frustrations of business owners up and down the UK. Confidence in the government and the economy will take a hit.”
PayU today announces the acquisition of leading payments technology platform ZOOZ. The deal supports PayU’s ongoing expansion into high growth markets and targets the $994 billion* opportunity in cross border payments.
The ZOOZ acquisition is for an undisclosed amount but brings PayU’s total sum of investments and acquisitions in global fintech to more than $350 million since it began a series of strategic moves across the globe in 2016 to open access to financial services.
The ZOOZ and PayU teams will work together to create the leading, global standard payments infrastructure of the future. As part of this vision they will build a comprehensive, modular, and highly flexible ‘Payment OS platform’ that can support evolving merchant and broader payment industry needs. The platform’s immediately expected features include fraud management and real time reporting or smart routing, to better aid global merchant growth.
The deal follows a successful partnership which, for the first time, gave PayU merchants such as Gett and Kiwi.com access to 2.3 billion new customers across high growth markets via the ZOOZ-designed PayU Hub platform. It leverages PayU’s payments infrastructure and ZOOZ’s state-of-the-art technology to open up access to new markets for merchants with global aspirations and sets a new standard for payments across borders.
As part of the deal, due to close summer 2018, ZOOZ’s co-founder and CEO Oren Levy and CTO Ronen Morecki will become part of PayU’s Global Leadership team, focusing on tech and business development. ZOOZ’s 70-strong team of experienced technical and payments experts will also become part of the PayU team, boosting the business’ technical capabilities.
Laurent le Moal, CEO of PayU, said: “PayU is one of the most active investors in the fintech space and we are always looking for opportunities to innovate and support our merchant clients to grow. Today’s announcement is a great illustration of this philosophy in action and we are pleased to be welcoming the ZOOZ team further into the PayU fold. By working together to create the first ‘Payment OS’ platform we will advance PayU’s mission to help build a world without financial borders”.
Oren Levy, co-founder and CEO of ZOOZ added: “After a year-long, productive partnership, our shared vision to create a new global standard in payments infrastructure is becoming a reality with PayU’s acquisition of ZOOZ. The unique contribution we bring to PayU is an advanced technological layer which not only helps merchants worldwide to upscale their operations and provide a better customer experience, but also offers analytics and optimization capabilities that equip them with unprecedented insights”.
With the cross-border market expected to reach $994 billion in 2020, nearly two-thirds of cross-border business will come from high growth markets like Asia and Latin America, according to a report by Accenture*. Alternative payment methods still represent as much as two-thirds of all payments in these markets.
ZOOZ was founded in 2010 by Oren Levy and Ronen Morecki. It has become one of the most well-known payments technology players in Israel.
PayU is part of Naspers, a global Internet and entertainment group and one of the largest technology investors in the world. Following completion of the deal, ZOOZ will be wholly owned by Naspers, strengthening its Payments division and supporting its strategy to grow its financial services footprint across emerging markets with long-term growth potential.
Grafton Merchanting ROI Ltd, Ireland’s largest builders’ merchants and part of Grafton Group PLC, has implemented financial intelligent automation from Rimilia.
Operating 43 stores and locations across Ireland, Grafton Merchanting ROI serves trade buyers and the public under brands including Chadwicks, Heiton Buckley and The Panelling Centre.
Grafton Merchanting ROI’s finance team is based in Dublin. Each month the team handles all payments across 43 stores and outlets, handling thousands of transactions including cash, cheques, credit and debit card payments, and electronic payments.
The finance team decided to transform its bank reconciliation and cash allocation processes and to update existing manual, spreadsheet-based, processes.
Grafton Merchanting ROI selected Rimilia’s automated self-learning bank reconciliation and Rimilia’s cash allocation software, Rimilia Reconcili8 and Rimilia Alloc8 Cash, to automate cash allocation and bank reconciliation. The software solutions help businesses to move away from manual spreadsheets, save time and resources, and gain a real-time view of current cash balances to support cash management and financial planning.
Ellen Conry, cash manager, Grafton Merchanting ROI Ltd said: “Even though we checked all payments and accounts each day, we would complete reconciliation on the 20th day of the following month so financial analysis was historical. We wanted to change this and transform our cash allocation and reconciliation processes. Rimilia Alloc8 Cash has automated electronic payments from our customers with automated postings to our Debtors ledger and allocation based on remittance advices on a daily basis; while Rimilia Reconcili8 has transformed our reconciliation process.”
Rimilia Alloc8 Cash is already auto-matching 77% of Grafton Merchanting ROI’s cash allocation, while Rimilia Reconcili8 is currently matching 75% of transactions.
“The transformation from working with Rimilia is amazing,” concluded Ellen Conry. “We have access to real-time information, which has changed our processes and reporting. Rimilia has given us time and peace of mind with real-time visibility and control of cash flow.”
Steve Richardson, co-founder and CCO of Rimilia said: “Our mission is to equip finance teams with the technology to transform core financial processes and cash flow, and to provide them with real-time visibility and control. We look forward to growing our relationship with Grafton Merchanting ROI and continuing to demonstrate the transformation of core financial processes through intelligent automation.”
“This new Global Slavery Index makes for very uncomfortable reading. Modern slavery is one of the world’s fastest-growing and most profitable criminal endeavours, and these latest statistics show it exists in our own communities, and is not just happening in other countries. There are an increasing number of regulations, and growing pressure on businesses to ensure they have full visibility of their supply chain and understand exactly who is involved in providing goods and services. Having a full picture can ensure a company is ‘doing the right thing’, and also avoid unwanted media coverage and financial penalties.
“Businesses play a key role in the fight against modern slavery and could unknowingly have forced labour within their supply chains; this nefarious activity is often hidden through the use of subsidiaries and sub-contracting. All businesses – particularly those in high-risk industries that outsource raw materials such as cocoa and cotton – need to be closely analysing and monitoring their supply chain to protect their business reputation and identify any potentially illegal activity. Having accurate and up-to-date information is crucial to helping eradicate slavery and make it a thing of the past.”
Chris Laws, Head of Product Development – Compliance & Supply at Dun & Bradstreet
UL is proud to announce the launch of the Smart Tachograph Card Personalization Validation Tool.
Smart Tachographs are the new generation of on-board mandatory digital recorders to enforce the EU legislation on professional drivers driving and resting times. The second generation (Smart) Tachograph is required in all commercial vehicles registered after June 15 2019.
The UL Smart Tachograph Card Personalization Validation Tool (PVT) is intended for Smart Tachograph card manufacturers or personalization service providers as well as OEMs or EU Member States who want to test and/or verify the correct functioning of a Smart Tachograph card. The tool is designed for testing the Smart Tachograph card is personalized correctly in compliance with EU Commission Implementing Regulation 2016/799.
‘‘We are very proud to release the UL Smart Tachograph Card Personalization Validation Tool’, Ibrahim en-Nali, Technology Director at UL said. ‘‘ In order to verify reliable functioning of the Smart Tachograph card system, it is mission-critical to have the most current and up-to-date tool that tests the personalization data of Smart Tachograph cards to ensure everything is correct and compliant.’’
As an independent advisory and test partner, UL provides in-depth knowledge and expertise related to the Tachograph and wider automotive security community. For over a decade, UL has actively contributed to the Tachograph community by supporting the standardization and specification of the Digital and Smart Tachograph as well as providing state-of-the-art test tools and services.
Commenting on today’s Office for National Statistics (ONS) crime in England and Wales statistical bulletin, Josh Gunnell, Head of Fraud & ID Pre-Sales, TransUnion (formerly Callcredit), said: “The volume of fraud offences in the past year has remained relatively stable meaning that the risk of becoming a victim of a fraud attack is still substantially high. The fact that there were 4,484,000* incidents of fraud and computer misuse from April 2017 to March 2018 speaks volumes, and we have to remember that these are only the figures of those which have been reported. The sheer amount of incidents implies that businesses are often still playing ‘catch-up’ when it comes to keeping both their customers and employees protected. In today’s increasingly regulated data climate, where the fines for failing are so high, businesses need to step up.
“The key to long-term success is through gaining and retaining consumer confidence so it is essential that organisations get up to speed with the prevention and detection techniques available. If businesses cannot show their customers that they are doing everything they can to keep data and identities safe, the cumulative damage could be greater than a fraud attack itself.
“To protect an organisation against fraud, a mix of human and technology-based solutions are required. Recent research we undertook found that nearly half (49%) of businesses already have some specific anti-fraud education as part of employee induction but there is still more work to be done and many recognise this. 43% of businesses are hoping to implement live exercises to test how staff respond, and 42% see employee drills having a role in combating fraud.
“When it comes to technology, our research found that nearly half of businesses (45%) are already using surveillance and 42% are using URL tracking as a protective measure against fraud attacks. However, they are also looking to take technology-based solutions one step further in the next two years – with 90% looking to implement improvements to ID verification, 45% deploying artificial intelligence and 37% utilising biometric screening techniques. This is increasingly important, considering over half of the fraud incidents in the past year were thought to be cyber-related, which is largely a ‘faceless’ channel.
“Society has been grappling with fraud since 300 BC, and sometimes it may feel like fighting a losing battle. But with the right combination of traditional techniques and emerging tools, businesses can protect themselves and win the war.”
*Figure is combination of Table 6 Crime Survey for England and Wales fraud – number of incidents for year ending March 2017 and year ending March 2018 with percentage change1 , 2 and Table 5: Crime Survey for England and Wales computer misuse – number of incidents for year ending March 2017 and year ending March 2018 with percentage change1 , 2.
A concerted political focus on increasing the number of first-time buyers has resulted in a relatively strong increase in the number of mortgage products catering for such purchases however the growing likelihood of an increase in Bank Base Rate (BBR) has resulted in an increase in costs for this borrower demographic.
The latest findings from the quarterly AmTrust Mortgage Loan to Value (LTV) Tracker show that average interest rates have increased quite significantly for those with either a 5% or 25% deposit, with the former seeing average rates up by 21 basis points and the latter by 12 basis points.
Recent suggestions from the Governor of the Bank of England, Mark Carney, are that the Bank of England’s Monetary Policy Committee (MPC) will vote to increase BBR at its meeting in August, and the AmTrust survey appears to show lenders have already priced in such a rise to their products.
Average fixed-rates for 95% LTV mortgages, according to Bank of England data, have increased throughout this year, up to 3.95%. Average rates for 75% LTV mortgages also increased to 1.74%. While the rate differential between 75% and 95% LTV loans has narrowed slightly to 2.1%, first-timers with only a 5% deposit can expect to pay close to two-thirds more each month and year for their loans.
This means first-time buyers with a 25% deposit will pay on average £20 more each compared to those with just a 5% deposit who will pay £22 more.
AmTrust’s research reveals that the average loan required by first-time buyers has gone up again since the last quarterly tracker in April – up to £125,397 for those with a 25% deposit, and £158,836 for those with a 5% deposit.
The AmTrust Mortgage LTV Tracker reviews the average monthly mortgage payments for first-time buyers on average loan levels, comparing loans for those with a 5% deposit to those with 25%, and looks at the product availability for first-timers.
Given the increase in average rates over the last quarter, AmTrust continues to believe that a BBR increase in August may not immediately feed into lender’s rates as they appear to have made a pre-emptive mood. However, it warns first-time buyers to anticipate a changed environment over the next few years as BBR reaches a ‘new normal’ with further increases likely over the next 12-18 months.
Product numbers continue to fluctuate
The Government’s continued focus on supporting the first-time buyer market has led to an increased interest in the sector, not just from mainstream lenders but also challenger banks and specialist operators.
This has led to the number of product options available to first-time buyers within the last quarter seeing a rise at both 75% and 95% LTV levels, and across both two-year and all product-type options.
The AmTrust LTV survey continues to review the number of actual product options available to first-time buyers with either a 5% or 25% deposit based on the price of an average first-time buyer house from UK Finance figures, the price of an average house as outlined by the June 2018 Halifax House Price Index, and the price of a house at the starting tier of stamp duty land tax, £300k. Below this amount first-time buyers do not need to pay any stamp duty.
In order to do this, AmTrust uses one of the online mortgage search engines which include deals available to both mortgage advisers and direct-only.
The latest research revealed there has been a significant increase in product numbers across both the 75% and 95% LTV options.
Those lucky enough to be able to review 75% LTV options, have access to hundreds if not thousands of products – dependent on type and term – while the options for 5% deposit borrowers have also shown an increase although the choice is unlikely to stray into the hundreds if they want a two-year term.
Lenders continue to aim the vast majority of their first-time buyer product range at borrowers who are able to put down significant deposits on their property. Coupled with the greater costs for 5% deposit borrowers, AmTrust continues to be concerned that only those individuals who can access the Bank of Mum & Dad are able to get on the housing ladder.
It continues to urge lenders to look at options to increase their high LTV mortgage business, for example, by utilising private mortgage insurance to mitigate credit risk and act as a catalyst to drive rates down closer to ‘normal levels’ for lower LTV borrowers.
Pad Bamford, Business Development Director at AmTrust Mortgage & Credit, commented: “This iteration of the AmTrust LTV Tracker is notable for two core reasons – firstly we are clearly seeing lenders getting in their ‘retaliation’ first when it comes to rate increases. The ‘mood music’ around the Bank of England’s MPC suggests that a rate rise is increasingly likely in August and mortgage lenders appear to be jumping before they are pushed.
“In a way this might be viewed as something of a positive as it should not mean a big glut of lenders jumping to raise rates once the announcement is made. However, this is only because rates have been upped over the past few months and there is a strong message to the market here that the days of ultra-low pricing is likely to be behind us.
“There are however clearly positives for first-time buyers – house prices are still high but they do not appear to be moving upwards with any vigour and indeed we’ve seen some falls in certain parts of the UK. With a far greater level of product availability for first-timers added into the mix, and the fact no stamp duty is payable on homes valued at £300k or less, then you could say that prospective new purchasers are in as strong a position as they have been for some time.
“But, and this has remained the case for a number of years, the major obstacle to overcome for most first-timers is still securing the deposit. Even at the 5% level, the average first-time buyer purchasing the average first-time home is still going to need in the region of £9k before they even consider whether such deals are affordable to them.
“Those who want to access the very best rates at the 25% deposit level, and save themselves over two-thirds each month on their mortgage payment, have an even greater challenge on their hands and would need to find over £40k. It is perhaps no wonder that we have real concerns around the ability of would-be homeowners to save this type of money; indeed without the help of family and friends it might seem like an impossible job.
“Clearly £9k is a lot of money but it is far more manageable than £40k, and we do not believe that the price differential between the two should be so high, or that those who can only save a 5% deposit should be having to pay such greater amounts in mortgage payments. This is why we urge lenders to look at other methods in order to increase their supply of products, and appetite to lend, in this market – one of which could be private mortgage insurance.
“Cutting down on the risk is one way to improve the appetite to lend, and while we approve of the increase in product options, this does not always translate into increased lending. The good news is that competition continues to grow, and lenders who might ordinarily not be looking at the first-time buyer market are now much more willing to. If more focus could be trained on high LTV lending then we would go a long way to ensuring far more first-time buyers have a fighting chance of getting on the ladder.”
The Lending Standards Board (LSB) and the Money Advice Trust, the charity that runs Business Debtline, have today published a report that explores the impact of vulnerable circumstances on people who run small businesses.
The report draws on insight gathered from LSB registered firms, as well as interviews with money advisers and clients of Business Debtline, the UK’s only dedicated free debt advice service for small business owners. The research found that there is often a direct link between a business’s financial difficulties and the person running the business experiencing some form of vulnerable circumstance, such as a mental health problem or serious illness.
Given the importance of small businesses to the UK economy, understanding the nature and impact of vulnerability in this context is crucial. The report finds that while progress is being made, there is more that can be done to support business customers in vulnerable circumstances. The findings aim to stimulate discussion in this area and enhance firms’ understanding of how vulnerability affects their business customers.
Firms are being encouraged to undertake a gap analysis to assess potential improvements to their policies and processes in the five key areas of policy, identification, support and management, training and monitoring.
Dave Pickering, chief executive of the Lending Standards Board said: “Identifying and supporting customers in vulnerable circumstances continues to be high on the agenda for financial services. However, much of this work has so far taken place in the personal, rather than business, customer space.
“We hope this report – in conjunction with our Standards for Lending Practice for Business Customers, launched last year – will prove a useful tool for firms looking to improve in this crucial area.
“The LSB will ensure that we keep driving the SME vulnerability agenda forward, working with our registered firms and other industry stakeholders to help bring about positive change for small businesses.”
Joanna Elson OBE, chief executive of the Money Advice Trust, the charity that runs Business Debtline said: “Every day our advisers at Business Debtline help people whose businesses are in financial difficulty, with a range of vulnerable circumstances often contributing to the challenges they are facing.
“Small business owners are no less likely than anyone else to experience vulnerable circumstances – and with small businesses contributing so much to the UK economy, it is crucial they receive the support they need.”
“We have been pleased to partner with the Lending Standards Board to explore how the industry can bring the benefits of its focus on vulnerability to the business customer space. We look forward to working with firms as they consider the report’s findings in the months ahead.”
More than half of Brits have never checked their eligibility when applying for a credit card, loan or mortgage, new research from Experian reveals.
Each time someone makes an application, a “hard search” is recorded on their credit report which could impact their credit score and reduce their chances of getting accepted for the best deals in the future.
Eligibility helps consumers by leaving a “soft search” and showing them which products they are likely to get before they apply without affecting their credit score.
But Experian has found 55% of UK consumers have risked damaging their credit score by applying without first checking how likely they are to be accepted – despite it typically taking less than a minute to do so*.
Why Brits don’t check their eligibility
Nearly a quarter (23%) of those who admitted they haven’t said it was because they don’t know what the benefits are and another 20% incorrectly believe that checking will negatively impact their credit rating.
Other common reasons for not checking include not hearing of an eligibility tool (18%) and not wanting to provide personal information including bank account details (18%). Another 15% said there was no guarantee they’ll be accepted for credit even if they used eligibility.
Interestingly, it appears that older Brits are more reluctant to use eligibility. Three quarters (75%) of those 55 and over have never checked, compared to just 25% of 25 to 34 year olds.
Analysis of the latest data from Experian** also shows how important checking is. Some 15.8% of Brits shopping for personal loans on its comparison website in March had a “0%” eligibility rating for all products.
That means they have no chance of being accepted for a loan and risk damaging their credit score if they were to make an application.
For those that did check their eligibility, nearly half (45%)** had a 70% or better chance of being accepted for at least one credit card or loan and more than one in five (21%) had a 100% chance of being accepted.
Why Brits do check their eligibility
Whilst 55% of Brits don’t check their eligibility before applying for credit card or loan, 45% of Brits do.
The most popular reason why people checked their eligibility (47%) was because they wanted to make sure they weren’t negatively impacting their credit rating by applying for cards and loans they had no chance of being accepted for.
Other popular reasons included:
· To make sure I was only applying for deals I would be accepted for (40%)
· To save time by not applying for cards and loans I had no chance of being accepted for (37%)
· Because checking eligibility is easy to do (33%)
· To make sure I was getting the best rates available to me (30%)
And there are signs that Brits who might not have the best credit history are taking steps to take control of their finances.
A quarter (25%) of all credit card searches on Experian’s comparison services are for credit builder cards, which help people boost their credit scores and gain access to better financial products and rates in the future.
James Jones, Head of Consumer Affairs at Experian, comments: “Using an eligibility-checking service can make a real difference when it comes to getting the best deal and financial products.
“It’s fantastic that many Brits are checking before applying for credit, and not putting their credit score at risk, but there’s still a majority who are missing out.
“More than 1 in 5 customers checking had 100% for eligibility, which means they don’t have to worry about which products they can get, and instead focus on finding the right credit card or loan for their needs.
“At Experian we’re keen to debunk the myths and misconceptions around eligibility to educate and empower people to take control of their finances.”
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