Response to the latest ONS retail sales figures

Ryan Kemp, director of retail at TransUnion (formerly Callcredit) comments on the latest ONS Retail Sales Index: “The retail industry showed strong growth in January 2019 when compared with the previous year, both in terms of the amount spent – which was up 4.3% – and the quantity bought – up 4.0% – which is good news in light of the current economic uncertainty as Brexit looms.

“Unsurprisingly, there were some specific monthly decreases following consumers splurging in the January sales, such as online sales at department stores – down 22.8% – and textile, clothing and footwear stores – down 22.5%.

“Overall, however, online sales saw a year-on-year increase of 9.4%, when compared with February 2018, which is a clear affirmation of the ongoing shifts within retailing towards ecommerce, in addition to investments in personalisation, improving the customer journey and enhancing the in-store experience.

“Retailers should be adapting their business to the changing marketplace, since new kinds of consumption such as curated subscription models, the service economy, auto-replenishment and smart reordering have the potential to fundamentally alter the retail landscape. Innovation is essential to ensure retailers can meet the demands of today’s discerning consumers. Whether in-store or online, the use of data plays an increasingly important role, and forward-thinking retailers will keep exploring ways to leverage data-driven insights across sales, marketing, customer service and operations.

“Fraud prevention should also be a key consideration for retailers, as the shift towards online shopping brings with it increased opportunity for fraudsters. According to the British Retail Consortium’s 2019 retail crime survey, despite retailers spending 17% more on cybersecurity than last year, nearly 80% of the retailers surveyed saw an increase in the number of attacks and/or breaches. Vigilance is essential to protect consumers from ID theft, phishing and other scams, and having the right tools in place will benefit businesses and consumers alike.”

FCA Findings the Time for Change is Now

“While the FCA and industry stakeholders will be consulting in the weeks ahead following the regulator’s publication of its report on motor finance, the clarity within the report suggests some of the key changes that are likely to be required. I’m sure we will see the industry moving to affect changes sooner rather than later.” This is the observation from Shaun Harris, Sales Director at Codeweavers.

The regulator has signalled three areas where change is likely to occur:

  • The end of the DIC commission model in all guises
  • An increased focus on transparency through the financing journey
  • Greater rigour in the affordability checking process

Over-arching these is the move by the regulator to affirm the need for lenders to ensure they undertake oversight of the dealers/brokers financing activities. With multiple lenders typically used by a dealer, the accountability for this responsibility is something that will need clarity, but certainly, dealers and brokers must recognise that this is coming.

“It may be uncomfortable but moves to remove a dealer’s capacity to vary interest rates to increase commission are likely to emerge sooner rather than later and alongside these may well be a requirement that commission levels are disclosed.

“Arguably such changes have been inevitable. Some major dealers already operate on a single fixed interest rate approach and I expect this to become the new norm,” reflects Harris. In closing he notes; “The elephant in the room here will be the impact on income; it seems inevitable that will be some knock-on impact on metal pricing and for this reason I expect that a rapid domino effect will take place as lenders follow one another to reflect the regulators desired position well ahead of any cut off date.”

Conveyancing Association supports launch of new Freehold Management Enquiries form

Over 14 cross-industry trade and representative bodies, including the Conveyancing Association (CA) – the leading trade body for the conveyancing industry – have come together to create and endorse a new Freehold Management Enquiries (FME1) form.

Those involved in the creation of the FME1 form are urging all conveyancers to use this new standardised questionnaire to secure the necessary information if a property being sold is managed freehold. This is where a freehold property has a shared amenity requiring a maintenance either through an estate rent charge or covenants set out in the title.

The information required by the FME1 would come from the Rent charge Owner, the Management Company, the Managing Agent or any appointed representative of them, and would provide greater certainty around the provision of the information required to ensure the conveyancing process can progress.

Use of the new FME1 form will ensure that prospective purchasers have full details of any contribution required, who organises the maintenance arrangements for the shared areas/amenities, likely increases to these amounts, and who owes what.

Currently, each conveyancing firm raises their own preferred questions in such cases which the group believes can create confusion and extra work, especially where the seller’s conveyancer does not ask all of the questions required by the buyer’s conveyancer.

The new FME1 form has been based on the updated Leasehold Property Enquiries (LPE1) which was also amended by a cross-industry group, and is now used in over 70% of all such transactions.

Organisations which have collaborated, fed into the creation of the FME1 form, and approve the LPE1 include: ARHM, ARLA, ARMA, the British Property Federation, the CA, the Homeowners Alliance, CILEx, IRPM, the Law Society, the Leaseholder Association, NAEA, RICS, RTMF and the Society of Licensed Conveyancers.

This group of organisations and trade bodies will enter into a memorandum of understanding so that they jointly hold the copyright, with the form both freely available and available for free, to those who wish to use it but without the ability to alter the questions or format.

Regular reviews of the form’s contents will take place to ensure it remains current.

Beth Rudolf, Director of Delivery at the Conveyancing Association, commented: “With the Government now banning leasehold houses, we believe this is likely to mean a move to more managed freehold schemes with owners who have shared access ways, gardens and amenities. It is therefore vitally important that any prospective purchaser has all the information they require around the nature of their responsibilities, service charges, what this covers, insurances, how disputes are handled, etc, so they are in full possession of all the facts and to ensure there are no surprises for anyone.

“This new FME1 form – created by an industry working together and endorsed by a large number of organisations and trade bodies – is comprehensive and includes a series of standardised questions which will make the whole process that much easier, quicker and more efficient.

“It is a conveyancer’s role to collate all the relevant information to be able to inform the buyer and their lender of matters which might affect the security or intended use and enjoyment of the property, and we would therefore urge all our member firms to use this new FME1. The LPE1 form has been a major success and we anticipate that the FME1 form can achieve the same results.

“This type of collaboration shows the industry can work together and we can achieve some significant milestones and steps forward. We would all like to thank those that have contributed to this piece of work, and believe it will soon become a standard part of the process when purchasing a managed freehold property.”

Paula Higgins, CEO of the HomeOwners Alliance, said: “We fully support the introduction of this new form. It will help future buyers of newly-built freehold properties to understand in advance their responsibilities for shared areas, including communal open spaces, roads and play areas. It will also clarify details of payments, such as service/estate or maintenance charges, for these shared spaces. Being the owner of a freehold property on a newly-built estate is an emerging form of tenure and people are very often not fully aware of all their obligations. The HomeOwners Alliance are pleased that more consistent information will be provided by conveyancing solicitors upfront earlier in the sales process and that the form will be freely available. We will do our best to raise awareness of it and the issues it covers among people buying homes on newly built estates.”

FICO Survey: UK Car Buyers Shifting Toward Online Financing

Car buyers in the UK are finding more of their financing online. That data comes from the second annual survey on auto financing conducted by leading analytic software firm FICO, which showed that:

  • 21 percent of UK buyers got their financing online, vs. 15 percent last year, an increase of almost 33 percent.
  • Of the nine countries in Europe and the Americas surveyed, only Chile saw more respondents getting loans online (24 percent).
  • 37 percent of UK car buyers said they would prefer to apply online the next time they buy a car.

The research, which looked at how consumers view the financing aspect of their auto purchase for new and used vehicles, also showed that UK car buyers got their financing faster than any other country but Germany, which tied with the UK:

  • 55 percent of respondents got their financing in less than 30 minutes.
  • However, this was less than last year, when 63 percent of buyers waited less than 30 minutes.

Nonetheless, UK car buyers found the process easier than people in other countries:

  • 82 percent found it easy, just above Germany (81 percent) and Mexico (80 percent), and well above the USA (68 percent).

“Consumers are taking greater control of the auto financing process,” said Steve Hadaway, general manager for Europe, the Middle East and Africa at FICO. “They are moving online in their search for a better deal. Those lenders that can instantly offer a superior financial package based on analysis of the applicant’s data stand to gain.”

FICO’s independent research surveyed 2,000 adult consumers across nine countries, including the US, Canada, Mexico, Chile, Australia, New Zealand, Germany, Spain, and the UK. The respondents were between the ages of 18-64 who acquired a loan or lease on a new or used vehicle within the last 3 years.

Digital banking: brave new world or house of cards?

Financial companies are increasingly turning to advanced technology to bolster their key services. Automated fund management is becoming a daily reality for many retail investors as advanced financial technology becomes miniaturised – companies like Nutmeg have built their business model on mobile-based automatic investment.

Even for larger, more traditional investment houses, essential market and risk analysis is shifting towards digital – as machine learning becomes more advanced, software is increasingly able to perform critical judgements that were previously the preserve of humans.

With that shift comes a heavy reliance on technology in frontline business as well as back-end processes. As such, the security of these applications is paramount. Banks and other financial institutions need to ensure they have full visibility of their systems and are able to detect potential threats to their customer-facing systems. A compromised investment app could lead to serious losses and, if the firm in question is influential enough, have a significant impact on wider markets.

Security’s weight problem

To add to that problem, the cyber security that guards those banks is often huge, unwieldy and poorly linked up. For decades, the young cybersecurity market has been about specialism: laser-focus companies designing highly-adapted solutions to solve a particular problem – malware, say, or phishing – as well as possible. That’s all well and good in the sense that each platform does the best job for its users, but over time it’s led to a highly expensive and unwieldy situation for buyers and security analysts who have to assemble a defence from multiple vendors.

Think of it this way: imagine you need a new car. But instead of going to the local dealership and buying a shiny Ford, you have to ring up the door manufacturer and ask them to bring you four doors. Then you call the seat company, and they deliver five seats. The engine makers, the boot shapers, the hubcap painters. All of them craft a quality product, but you’re left with an enormous bill and you still have to put the thing together and make sure it actually works.

That’s essentially the problem facing large banks in the current culture. They purchase a firewall, an email filter, a threat intelligence database, an antivirus software, and whatever else they need, and each of them does a great job – but overall, they’re a burden to run. They don’t talk to each other, and each has its own dashboard. Security analysts have to spend hours sifting through alerts to find the truly crucial issues, and valuable time is lost tending to individual systems.

That’s the CISO’s problem. But for the CEO, there’s a bigger issue – running multiple security systems is expensive. Really expensive. The more systems you have, the more highly-skilled staff you need, and they’re few and far between. Where cybersecurity used to be a classic back-office concern, like air conditioning or heating, it’s now a central part of strategy and a key pillar of both reputation and customer retention – financial legislation leaves no room for failure. Above all, though, at present, it’s a cost centre.

Send an algorithm to do a human’s job

So how do financial institutions maintain the benefits of digitisation whilst reducing the weight of security? In a word: orchestration. As cybersecurity has grown and developed, so has computer automation. Companies can now link their key systems together under a single automated management tool (often referred to as a security orchestration, automation and response or SOAR platform) to reduce the weight on their staff. Orchestrating your security landscape essentially means integrating systems so that their alerts and data flows are monitored by the SOAR, which then automatically resolves low-level alerts and flags up high-priority issues that need human review.

The upshot of that is that security resources can then be spent more profitably on strategic initiatives like system reviews and regulatory compliance. The CISO is happy because their security systems are preventing attacks and the team is more available for new projects, and the CEO is happy because costs can be streamlined by removing unnecessary admin tasks and slimming down software spend.

More importantly, an effectively orchestrated security system can be easily amended to accommodate new elements of the organisation’s digital landscape – meaning that financial organisations are freed up to innovate in the age of PSD2 and open banking without fear that every new application will come with a six-figure security cost.

Digital banking is the future – there’s no question about that. But financial organisations will have to change the way they approach security system management if they’re to keep up with and support innovation. Orchestration is one way to lighten the load – without compromising on quality.

Adam Vincent, CEO, ThreatConnect

Women in FinTech: Fresh Perspectives

The financial services industry is well known for being fast paced, competitive and male-dominated. In Fintech, women are vastly underrepresented, making up just 29% of staff in the sector, despite representing 47% of the UK workforce. But this is also an industry in transition – and growing numbers of companies now recognise the importance of promoting gender neutral pay structures and flexible working policies. As Rosie Silk, R&D Tax Manager at Kene Partners, explains, with the right working policies and role models, concerns about attracting women to the industry should be rapidly consigned to history.

Zero Bias

Gender pay gaps. Endemic sexual harassment in Silicon Valley. It is easy to assume that the experience of women in the workplace has failed to improve over the past three decades. But that is patently untrue. There are many organisations within the FinTech sector that are passionate advocates for generating a positive working environment, and one that has zero gender bias.

Given the challenge of recruiting high calibre individuals, companies need to encourage working practices that suit today’s attitudes towards work/life balance. Both women and men should have equal access to flexible working policies, for example.

However, of course, FinTech is a young industry. Fast growing, start-up organisations will often overlook the need for flexible working models to support parents of both sexes. Indeed, in many start-ups, such flexibility is simply not an option. But this is an industry that offers choice: if flexible working is important to any individual, then look for a different employer. There is without doubt a divergence in cultural attitudes and behaviours as well as working practices in firms across the FinTech sector, and it is incredibly important for both employer and employees to understand and identify those issues up front. Skills and experience alone are not enough to ensure a great fit.

Role Models

This is also where female role models can play an important part, not only to inspire contemporaries and the next generation but also to set expectations within the workplace. The days when women leaders felt the need to adopt so called male leadership traits are long gone; successful women are leaders on their own terms in FinTech as much as any other industry, and that is an important message.

Attending an innovation conference recently and finding four women on a panel of five, is incredibly inspiring. Furthermore, these women can also reinforce a strong culture by acting as coaches or mentors to new starters. But it is also important to remember that changes to the workplace alone can never achieve zero gender bias without a wider change in culture, at home and in education.

Chat to any successful women in FinTech, or just any successful women, and the story will be the same: they were provided with a huge amount of confidence at home, encouraged to try new experiences and treated equally. As a result they expect to be treated fairly at work and to have access to the same opportunities. They are also confident enough to take risks and embrace innovative business areas such as FinTech.

For any business leaders carefully crafting good flexible working policies, don’t forget to apply the same encouragement and support once you get home from the office!


Despite the occasional negative headlines, times have without doubt changed. In addition to the support provided by switched on employers, women leaders are now becoming commonplace and acting as role models to the next generation. Companies across the board are investing in new working practices to support all staff and, as this continues, hopefully, within the next few years this conversation will be consigned to history.

Broker Conveyancing announces management changes at end of earn-out period

Broker Conveyancing, the broker-focused conveyancing distributor, has today announced a change in its management team following the end of the earn-out period with its former owners.

Conveyancing Alliance Limited (CAL), which includes the Broker Conveyancing and Agency Convey brands, will have a new management team from the end of this month.

In 2016 CAL was bought by ULS Technology plc and Directors’ Harpal Singh and John Philips will step down as Executive Directors on the 31st March following the end of the earn-out period. They will however be working with the new management team in non-executive roles.

Mark Snape takes over the role of Managing Director of CAL and will form a new management team with Keith Young who has been promoted to the role of Sales Director.

Mark built his career in financial services and Keith worked in the estate agency sector before joining CAL in 2016 prior to the acquisition.

Harpal Singh commented: “This was a day we knew would come but still feels slightly surreal for John and I to be leaving a business we have built up over the past decade. It has been a real labour of love and we cannot thank enough all those who have used the proposition, our conveyancing firms and those that have contributed so much to delivering a highly successful business. We exit stage left knowing that this is a business that is in highly capable hands, that it remains business as usual, but also that Mark and the team will drive it forward, offer plenty more to both new and existing users and continue to offer an incredible quality of service. We will continue to be involved with the business on a non-executive basis.”

Mark Snape, new Managing Director of Conveyancing Alliance, said: “This has been a smooth handover for all concerned and I’ve been given time to learn all about how this fantastic business is run, the strong relationships it has, and the users that come back to it, day-in, day-out. Taking on this role has always been about ensuring the proposition continues to deliver all it has under Harpal and John. I have experience in a large number of adviser/agent-facing roles and our focus as a conveyancing distributor will be on the solicitors and conveyancers we are partnered with and ensuring the quality of service is maintained to our end-users. It’s an exciting time for CAL and Broker Conveyancing. I’d like to give my thanks to Harpal and John for their guidance and support over the last six months in particular.”

Brits don’t feel in control of their finances..

A SHOCKING number of UK adults don’t know how to manage their finances in a responsible manner, according to new research.

A survey of 1,000 UK adults, carried out by Creditfix, the UK’s largest personal insolvency practice, found that only 34% of Brits admit they feel ‘in control’ of their finances. An overwhelming number (57%) said they couldn’t even confirm the amount of money in their bank account at that current time.

The research also reveals that only 1 in 5 (20%) British adults log their outgoings each month to keep track of their finances, while 14% admitted that they would only check their bank account twice a month.

When quizzed on the reasons why Brits didn’t keep a closer eye on their finances, almost 1 in 3 (31%) said they didn’t have time to log their outgoings each month, while 15% simply stated they preferred not to look at their bank account so often.

Taylor Flynn, marketing manager at Creditfix comments: “It’s worrying to see just how few British adults feel in control of their finances. It’s understandable of course, but it is concerning.

“There are simple ways to manage finances and thanks to apps and technology advances, there are more things available than ever before that can be used to make this easier. Setting a realistic weekly budget will allow Brits to monitor how much they can spend to avoid going into any unwanted debt. By scheduling monthly bills, this will help to control any outgoings as it can be monitored effectively. Creating a monthly log to track spending on items such as bills, food shops and social activities is also helpful and doesn’t need to take endless amounts of time. This will make life easier in the long run and can prevent debt and financial difficulty along the way.”

The FCA Report – the ‘Spark’ for Positive Change

MotoNovo Finance CEO Mark Standish has issued a positive assessment of the FCA’s findings, following their review of motor finance, announcing; “While in the short-term, I recognise that the findings from the recent FCA report on motor finance will create short-term challenges, our overwhelming view is that overall, the report provides the catalyst for the retail motor sector to create positive change that will engender greater trust and sustainability in the market. MotoNovo is committed to being alongside dealers at the heart of this change.”

The FCA’s review’s findings set the scene for changes in the commission model, transparency and affordability, with lenders set to adopt an active role in dealers’ promotion of finance. Standish’s view on addressing the changes required is clear;

“The FCA has thrown down the gauntlet to lenders and dealers to improve the customer proposition and experience. We see this as a significant opportunity to move decisively to embrace a new retailing model centred around the finance that 80% of customers need and the sustainable margins that dealers require.”

While the FCA report might be the ‘spark’ for change in motor retailing, the evidence that the established used car retailing and financing model can only benefit from a ‘re-boot’ is evident:

  • In used car financing, around 65% of current used car buyers choose their bank or direct lender for a personal loan offered at a cheaper rate, within a customer journey that provides them with a greater sense of transparency and control
  • The growth of a range of vehicle and finance intermediaries and aggregators, who without the costs and risks of a used car motor dealer are presenting themselves as consumer champions capable of sourcing cars and finance to help the customer. In doing this, they are often retailing dealer stock, at a cost to the dealers and finance. As with most successful market disrupters, their success reflects that an existing process is broken, inefficient or out of step with the needs of today’s consumers

Standish reflects that the FCA’s findings must be seen as crystallising shortcomings in used car financing in the dealer market and help highlight the benefits of embracing a fresh new approach;

“From its press release headline on their final report, the regulator makes it clear that they expect change in the commission model. The industry must also recognise that the distribution of dealer income between metal and ancillaries (particularly finance) will have to change. The FCA will just not accept a cross-subsidisation model designed to create a lower car price to enhance aggregator rankings.

“Addressing these issues can help create lower interest rates in dealer marketing and enable appropriate rate for risk pricing to be developed, vital when finance and car buying are so connected today and when increasing finance competition and online pricing transparency are prevalent.

“While there are examples of dealers who do far better, typical finance penetration rates within the independent used car dealer segment are no more than 15%; yet the 90% new car finance penetration performance points the way to what is possible.

Standish believes that moving forward, as well as addressing the FCA’s key findings around commission models, disclosure of information, affordability and monitoring of intermediaries, that motor dealers will need to look critically at their business models. Distribution and marketing costs will need to be optimised, margin in the metal will need to be enhanced and the approach to finance income will need to be based around; ‘a little and often’ approach that will see dealer finance become the preferred financing method for the vast majority of used car buyers. He concludes;

“It is time for an industry re-boot as we work to disrupt the disruptors and competitors and work to create a new customer-centric car retailing and financing model and the two are interwoven.

“As a business, we have a successful track record in innovating to help dealers; customer self-serve technology, the launch of and the ongoing development of risk-based pricing, are some of the most recent moves to help dealers. They are part of a broader package and culture that is delivering to dealers the most customer-centric and digitally enabled proposition available in the market today. In the weeks ahead we will be consulting with dealers and sharing our thoughts on the opportunities available and as outlined, the prize is well worth the effort!”

Foundation Home Loans appoint new Regional Sales Manager for South Central UK region

Foundation Home Loans, the intermediary-only, specialist lender has today announced the appointment of Paul Flude as its new Regional Sales Manager for the South Central UK region.

Paul has over 12 years’ experience in the mortgage market and joins with immediate effect from Fleet Mortgages where he was BDM for the South East having begun his career as an adviser with a national estate agency chain. He has a wide network of adviser contacts and will be focused on building relationships in the region.

Paul will report to National Sales Manager, Mark Whitear, and will be focused on presenting Foundation’s range of buy-to-let and residential mortgage products to advisers based in the South Central region.

Foundation’s products are offered to individuals, portfolio landlords and limited companies and includes the recently-launched ‘Fix to Flex’ five-year, buy-to-let deal aimed at those landlords who want rate certainty plus the flexibility to potentially switch to another rate/lender before the full five-year term.

Foundation Home Loans is a specialist lender, available only through intermediaries and designed for clients with more complex needs.

Andrew Ferguson, Commercial Director at Foundation Home Loans, said: “We continue to expand and build a highly-experienced, talented sales team and the addition of Paul adds considerably to our overall strength in this area. Advisers will know only too well the benefits of working with a sales manager who understands the market, is able to provide the necessary resource and support, and can secure the end result that everyone wants. Paul comes with a vast amount of experience and he has also worked as an adviser so knows both sides of the fence. We believe he will be an excellent asset to both Foundation and advisers in the South and would urge those within the region to contact him to see how he can support their business activity.”