April is the official National Financial Literacy Month; as it comes to a close, Finance Monthly has heard from Tamir Davies, content writer and researcher for Savoy Stewart, on the top 10 finance based books to look out for this year, a little about each and which reader they are best suited to.

Tackling the subject of ‘finance’, no matter your aim or venture, can be a difficult feat. It is a tricky topic to get your head around, even if you consider yourself an expert, and as the saying goes ‘knowledge is power’. One traditional way of acquiring this knowledge is by reading. You may be a solicitor, accountant, commercial property investor or CFO, but the ultimate aim is the same – to better yourself in the financial world and to make a return on investment.

1. High Returns from Low Risk: A remarkable Stock Market Paradox by Pim Van Vliet

Traditionally, investors used to view low-risk stocks as safe but unprofitable. And of course profitability is the most important aspect of financial investment. However, this is now a flawed theory. This book, explores how low-risk stocks are actually proving to be far more beneficial, and can outperform high-risk stocks. If you used to believe, the higher the risk, the greater the reward – this old axiom is holding you back.

Who’s it for: If you have money and want to know where to put it, with maximum return. Suitable for investors, those in private equity and property investment.

2. The Alchemy of Finance by George Soros

This book by George Soros, reveals his secrets as to how he became one of the world’s most successful money managers of all time. Soros has been nicknamed by Business Week as the ‘man who moves markets’. The book is a fantastic read for those looking to understand the theoretical and practical account of the financial market. The book illustrates real-world advice and valuable lessons that can be learnt in business.

Who’s it for: Savvy business owners looking for financial inspiration to reach the highest heights.

3. How to Save Property Tax 2016/17 by Carl Bayley

If you are a property investor and or landlord, then understanding how to save property tax for the new tax year is a key aspect of investment. This book really is a tax bible and this latest edition has been updated with all the major tax changes which were announced in 2015. It has a detailed analysis of the new rules which are to restrict tax relief on residential landlords’ interest costs, as well as investigating the new 3% stamp duty land tax surcharge. The book explores ways investors and landlords can save on tax, and therefore pay less income tax, capital gains tax and stamp duty.

Who’s it for: All property landlords and investors, second home owners, those looking to refurbish or develop a property, and solicitors, accountants and professional financial advisors.

4. Buy Low Rent High: How anyone can be financially free in the next 12 months by investing in property by Samuel Leeds

They say an investment in property will guarantee you a return. But to invest in property, many would assume you need a bundle of cash. In theory yes – but this book ‘Buy low rent high’, looks into challenging the traditional approach to investing in property, and to start with no money at all. Samuel Leeds, the author of the book has earnt himself a reputation for becoming one of the most inspiring and engaging investors in the UK, due to his tactic.

Who’s it for: A great read for amateur investors and landlords.

5. The Virgin Banker by Jayne-Anne Ghadia

Women CEO’s, have fast become one of the most popular topics in business. ‘The Virgin Banker’, by Jayne-Anne Gadhia, who is the CEO of Virgin Money, exposes the events and circumstances that shaped her career as we know it today. In her career, Jayne-Anne Ghadia has become one of the most powerful women in banking and her anecdotes include beating bullies as a child and overcoming racism having had a mixed race marriage. Her career triumphs include, working at RBS and finally putting Virgin Money on the road to success by becoming a listed business. Her book explores issues regarding women in the workplace, specifically banking, and drawing on personal experiences which has helped her secure her current position in finance.

Who’s it for: Women of all career fields – this is not a conventional biography, so if you’re a woman in business, looking to succeed, this could be your driving force.

6. How to Talk Finance: Getting to grips with the numbers in business by Ted Wainman

Getting into business is a tricky affair, especially if you’re unsure where or how to start. Ted Wainman’s book ‘How to talk finance: getting to grips with the numbers in business’, is a great way of beginning your journey into business, dissecting how a business is run, funded, structurally designed to trade and the costs involved. The book is user-friendly and will help you understand the numbers behind a business, as well as budgeting and developing a commercial awareness for the business you are launching.

Who’s it for: Business men and women looking to launch their own business. No matter the business field or type.

7. The Long and the Short of It: A guide to finance and investment for normally intelligent people who aren't in the industry by John Kay

John Kay, is one of the world’s leading economists and a hugely triumphant investor. His academic credentials and an unparalleled level of practical experience, places him as one of the world’s inspiring investors. If you’re after a book about finance and investment, ‘The Long and the Short of it: A guide to finance and investment for normally intelligent people who aren’t in the industry’ will speak wonders for you. The book assesses the complexities of the financial world, emphasising how the modern system is threatened by the stability of the world economy. The book has been designed to explain how to put your finances into your own hands, as these are the only ones to trust.

Who’s it for: Cautious investors and those in professional finance services who need some guidance to keep their money safe.

8.       The Investors’ Guide to the United Kingdom 2017 by Jonathan Reuvid

This edition by Mazars, exposes useful information for investors in the UK, looking to secure property in 2017. This book is an extensive round-up of the property industry since Brexit, indicating the climate for investment in Britain. The book also goes into great detail regarding the laws, business regulations and practices that are affecting foreign investors looking to put their money into commercial property. This edition also includes topics such as commercial law, intellectual property, business taxation, financial reporting and key industry sector opportunities.

Who’s it for: Any foreign business of any size. If your business is multinational or an SME, this guide will help you with technical aspects of investment.

9. The Little Book of Commonsense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns by John C Bogle

Investment is known as the most effective way of building wealth quickly and sustaining it. But the most difficult part is doing it correctly. John C Bogle, the founder of the Vanguard Group and the inventor of the world’s first index fund, has created this book that details the simplest ways of investing – with low-cost index funds. The book is filled with in-depth advice, knowledge and practical sentiments to show you how to incorporate this investment strategy, which Bogle deems the most effective of its kind into your portfolio.

Who’s it for: Commercial and independent investors looking to expand their portfolio in the most effective way.

10. Tools of Titans: The Tactics, Routines, and Habits of Billionaires, Icons, and World-Class Performers by Tim Ferriss

We all dream of becoming a self-made millionaire or even better – a billionaire. And ‘Tools of Titans’ by Tim Ferriss, looks at the daily routines and ritual habits of celebrities, hedge fund managers, professional athletes and others to understand how they became the wealthiest and most successful in their field. Ferriss interviewed more than 200 world-class performers, such as Jamie Foxx and Arnold Schwarzenegger, splitting his book into three chapters – healthy, wealthy and wise. Ferris’s book is a quest to unveil snippets of wisdom from these high achievers and to pass their tactics of success onto anyone interested.

Who’s it for: This a charismatic read, suitable for anyone who loves real-life advice and an interpretation of success. If you need a career push, this one’s a keeper.

Businesses have had to deal with a lot of change, and many have successfully embraced change to create whole new industries and many billions in new value. Yet other businesses literally vanished: Nearly 50% of the companies that were part of the Fortune 500 and FTSE 100 in 2000 no longer appear in those rankings today. Mark Nittler, VP Enterprise Strategy at Workday, here explains to Finance Monthly why technology shouldn’t be a barrier to change.

Some of these organisations were the result of the global merger and acquisition spree that has taken place over the last 30 years and continues today, and others fell victim to the financial crisis and Great Recession earlier this century. But many were simply overcome by the forces of digital disruption. In the face of technical evolution, their inaction allowed innovative start-ups and more agile competitors to win with newer, faster, and more-efficient ways of doing business.

With that in mind, it seems crazy that technology itself should be a barrier to change, but for many businesses that is precisely what happened and continues to happen today. Companies struggle because much of the technology they currently have in place to run their businesses was not designed to help them adapt and excel in this era of digital disruption.

It’s worth looking at how financial organisations have approached technology over the last 30 years. In my experience, the technology that was originally designed to automate transactions and financial accounting is now preventing finance from realising its ultimate goal: To be a better business partner.

When we think about the finance function today, it essentially has three main areas of responsibility: Transaction processing and accounting, compliance and control, and business partnership. Finance leaders are frustrated because their teams spend too much time dealing with the first two, leaving little time to be the strategic partners their companies truly need.

Achieving this vision of partnership requires finance to deliver data that goes way beyond the general ledger information that legacy systems were designed to record. With a wider set of stakeholders and a business landscape that is continually evolving, finance is being asked to provide the broader company with contextual information that can actively influence decision-making and, for the most part, they’re struggling in this mission.

If this vision is to be realised, then transformation must happen. Finance needs faster access to relevant data, better reporting, and stronger built-in internal controls. And because older financial systems were not created with this vision in mind, businesses and their legacy vendors have attempted to fill the void by bolting on missing capabilities. As a result, finance technology has become a complex mix of acquisitions, custom integrations, and middleware.

Despite seemingly perennial discussions around the need for finance to transform, this hasn’t really happened. Why? It’s primarily because legacy finance systems continue to stand in the way. They’ve stopped finance from mastering the elements of a true partnership: providing impactful business analytics, delivering clear plans and forecasts, and having the agility to adapt analyses, plans, and processes to business change.

Analytics that influence positive business outcomes stem from four traits that simply do not exist in legacy systems—a broad definition of the user, information relevance, simplicity, and availability on any device. Legacy ERP was designed in a command-and-control era, where information was delivered to a few who then communicated it to the masses. Today the audience for financial information is, quite literally, everyone.

This broad community is interested in analysis such as profitability, what-if-analysis, and cost model, but traditional ERP systems were built for IFRS/GAAP and regulatory output rather than delivery of contextual analysis. Finance teams have tried to tackle this lack of capability in their legacy ERP systems by looking for better reporting, achieved by bolting on aftermarket business intelligence or enterprise performance management reporting tools. But this approach hasn’t worked because the problem is not reporting—it’s the quality of the data and the ability to easily draw conclusions from analysis.

If the right data is not captured at the very beginning of the process at the transaction level, no reporting scheme will deliver relevant analysis. Modern systems, such as Workday address this issue at the transaction level by capturing data-rich transactions so that relevant analytics can be delivered directly from the system without the cost, complexity, maintenance, and control issues of aftermarket solutions.

Having the right data is the first step; making it usable is the next. Because we can no longer expect that everyone using the system is a back-office system expert, analytics have to be easy to define and understand and simple to access. And because everyone is mobile, relevant analytics must be available anywhere at any time and on any device. Such tools must be designed from the beginning for delivery on mobile devices as standard, not as an optional and a chargeable extra.

The days of static plans that last a year or more are gone, and to support the evolving needs of the business, planning must be an ongoing activity. And in order to be effective, planning and forecasting needs to be combined with transactions, controls, reporting, and analytics in a single system that offers a single source of truth, a single set of data, a single security model, a single control framework, a single set of processes, and a single user experience. Without this forward-looking approach, organisations run the risk of their plans becoming dated and redundant virtually as soon as they are produced.

That leads us to the third partnership attribute—agility. Legacy systems are inherently rigid, turning many otherwise very good finance departments into business prevention teams, because they’re unable to cause the change necessary to support new business initiatives. They need modern tools with the ability to change organisation structures, business processes, and even data models in minutes. Essentially, a finance system should be capable of converting a finance department into a change enablement partner to help the business rise to challenges and take advantage of opportunities, whatever they may be.

The journey to finance transformation isn’t easy, but it’s certainly doable. It requires an understanding of why previous efforts of failed, and reducing time spent on transaction processing. It also requires a rethink in terms of governance, compliance, and control, and how finance approaches this from a technology perspective. Finally, finance must become a more strategic business partner, by delivering insights from the right data, the ability to plan, and adapt to new opportunities as they arise. Only then can financial transformation take place.

Written by Richard Hurwitz, CEO of Tungsten Network

More and more we are enjoying the benefits that technology can bring. Drones are delivering packages. Robots are helping with cleaning around the house. Driverless cars have even begun ferrying passengers around some US cities. The recurring theme here is removing friction; doing away with tiresome, menial tasks that clog up our free time.

In the finance world, too, tedious jobs abound that needn’t. In my view the burgeoning FinTech sector is playing a huge role in reducing friction. Take electronic invoicing. As CEO of Tungsten Network, I’ve seen first-hand how digitising accounts processing frees up valuable time and resource to nurture partnerships. Equally, on-boarding suppliers reliably and securely fosters trust from the very beginning.

There are plenty of other examples of how FinTech enables frictionless business, such as Payoneer, an international money transfer platform that enables businesses and professionals to receive cross-border payments quickly, securely and at low cost – saving up to 90% on bank transfers while never leaving their desk. Another example is Lenddo, which uses non-traditional data from social networks and other sources to compute people’s identity and creditworthiness.

Technology is an enabler of relationships and development. Work streams like Procure to Pay – the implementation of a seamless process from point of order to payment – are allowing small businesses to link in partnership with large ones to innovate and grow. By cutting friction and easing pressure points in this way, the whole business community stands to benefit.

Technology is driving this change. In the retail industry, for example, automation and artificial intelligence are being used to speed up picking and packing. Current advancements in logistics are enabling humans to ditch the boring jobs and carry out more highly skilled tasks, such as robotics management.

Locus Robotics, with its strapline “robots empowering people” estimates that its warehouse solutions can help workers become up to eight times more efficient. Likewise, on the shop floor Target in the US is trialling a robot to track inventory – thereby freeing up staff to help customers more.

Twenty years ago, there were less than 700,000 industrial robots worldwide. Today, there are 1.8 million, according to figures from PwC, and this is projected to be as high as 2.6 million by 2019.

PwC carries out an annual survey of 1,400 CEOs around the globe. The most recent survey reveals that 52% of CEOs expect technology to have a significant impact in changing competition in their industry over the next five years, and 23% expect technology to completely reshape it.

Technological changes, perhaps, should be the focus in finance too. From procurement to payment there are plenty of opportunities to upgrade technology, yet many businesses still utilise time-consuming, unpredictable and inefficient sourcing and payment practices – wasting valuable human resources that could better target business growth and innovation.

To return to an example I’m familiar with, every day businesses waste time and energy by manually checking invoice documents received from an increasingly global supply chain, when technology exists that can reject incorrect invoices before they even arrive. Continuing with the theme, further time and energy is wasted for businesses and their suppliers who spend time calling and emailing to check on invoice statuses instead of accessing the information online. This friction can all be avoided.

Later in the accounts payable process, unanalysed procurement data stagnates in these paper invoices, instead of being quickly captured to understand procurement trends that can inform spending decisions. For suppliers, potential working capital is tied up in unpaid invoices, unavailable to be pumped back into the business and invested in targeting growth through new contracts or equipment. While invoicing is an old world example, the potential of digitising it sums up what FinTech is all about.

All businesses must think about what innovative solutions are out there, finance included, or risk falling behind the competition. At multiple points in the business lifecycle, sticking points and delays with manual systems cause friction not only for consumers of financial services, but also between suppliers in the industry and the businesses with which they work. This risks sowing conflict and mistrust between partners, weakening the trusted relationships on which supply chains are built.

I would argue that not embracing the potential offered by FinTech is a huge risk, causing friction at multiple levels. This can manifest itself in multiple ways: suppliers reticent to jump through too many hoops; administrative employees’ patience wearing thin; and finance departments hesitant to greenlight funds. Combined, the impact on the bottom line could be considerable.

The opportunities are endless and I’m confident that there’s even more potential for FinTech to enable the digital transformation of business processes, connecting buyers and suppliers with streamlined financial services capabilities and ultimately, removing friction across global trade.

2016 was an unprecedented year, with massive global political upheaval, the rise of Artificial Intelligence (AI), and centre stage being taken by issues such as ‘post-truth’, resurgent nationalism, and technological unemployment. These social, technological and political shifts have significant potential ramifications for all aspects of global finance, commerce and markets. Hence, with the world now more accustomed to such seismic agenda changing developments, the Fast Future Publishing team have turned our thoughts to the future and dipped into our recent book The Future of Business and our upcoming release The Future of AI in Business to suggest what might happen in the year ahead. Below we provide our 2017 year-end report, outlining 20 critical trends and scenarios we could see emerging, and highlight their potential impact on economic and financial markets.
Politics, Government and Regulation

1. The Presidency as a Business Model – Following his inauguration in January 2017, President Donald Trump rides roughshod over accepted norms of presidential behaviour. After his first year in office, analysts suggest that he could easily exceed President Putin’s estimated net worth of US$200Bn by the end of his first term, and could ultimately become the world’s first trillionaire. In this rapidly changing reality, businesses must become very aware of the new commercial opportunities that are opening up as a result of the president’s strategy. Equally vital will be to see where opportunities may disappear – a key example being the US car industry which is being strongly discouraged from investing overseas.
2. Who Needs a Constitution? – While opponents desperately seek a mandate for his impeachment, Trump’s team, his supporters and the major beneficiaries of his reign seek to extend the powers of the President. They also pursue the removal of limits on the duration of the US presidency and the number of times an individual can hold the office. This endemic uncertainty around the presidency could inspire volatility in financial and currency markets.
3. Brexit Brouhaha - Despite invoking Article 50 in the spring, the UK government is blocked at every turn by a string of legal challenges that hamper progress. The 'UK question' hyperbole was increasingly used by both sides in several national debates – from garnering support by claiming to represent the political will of the UK electorate on the one side to scaremongering on the risk to the UK economy and the European project on the other. This could lead to a number of companies wanting to exit the UK. However some of the incentives created around the future of Britain could encourage investment in the country – particularly the tax haven strategy.
4. May Day - Exasperated by the Brexit roadblocks and under pressure from many in her own party, Prime Minister Theresa May announces a general election for October 2017 to let the public decide if they want her Brexit plan. The result is a hung parliament, with UKIP the biggest single party and Nigel Farage leading the next coalition government. This dramatic political over-haul could lead to chaos in financial markets, initiate an exodus of foreign firms and talent, drive a reduction in corporate investment, and induce huge hesitancy in individual spending behaviour.
5. Wildcard Wagers - The tumultuous events of 2016 sparked a rise in public event betting markets, with 2017 becoming the year of the wildcard wager. Betting shops saw an incredible rise in bets being placed on all manner of events from animals escaping zoos to the sudden collapse of buildings. A new breed of AI-based betting companies emerged which even allowed us to bet on the life expectancy of an individual. These companies draw on social media and ‘permissioned access’ to personal data to determine your life expectancy. Those that give permission for personal their data to be accessed by the betting companies can then share in the proceeds of the bets on their life. While the market might be created by relatively new players, existing betting companies might also see it as a lucrative new opportunity.
6. Will They or Won't They - While regulators were called upon to question the ethics of betting on life or death scenarios, advocates saw the potential for public engagement through such betting, and single interest political groups arose around the potential outcomes of specific events. Online political networks surrounding betting events were created by disparate groups; with individuals identifying as will-happen or won't-happen. This saw sudden huge surges of political activity and engagement, which dropped off drastically after each such event. These new revenue generation opportunities might well be short lived if governments seek to control them. But there is an interesting new technological application; we might see AI being used here to dynamically create, operate and close these markets based around short term events.

Technology and Privacy

7. Artificial Intelligence – Following the hype phase of 2016, real applications started to emerge in 2017 – such as intelligent assistants on our smart phones and medical decision support tools. Cash-strapped governments turned to AI for the automation of a range of functions from processing student loan applications to handling divorce adjudications. The impact of AI could see businesses deliver a dramatic reduction in operating costs and exponential revenue growth.
8. Driving Ambition – In a bid to become a key centre of innovation and sector development in driverless vehicles, China and the UK led the way in allowing on road trials of driverless vehicles. Both governments accelerated the process of regulatory change to allow fully or semi-autonomous cars, trucks and buses onto roads across their nations in 2018. One of the most interesting early market impacts of this development could be the early arrival of very low cost upgrade kits that let us add autonomous features to our vehicles
9. Self-Powering Nations – Faced with continued uncertainty over the price, availability and environmental impact of fossil fuels, 2017 saw a record number of nations powering themselves with renewable energy for at least part of the year. We could see a significant reduction in overall energy production and distribution costs. This could bring a benefit to the consumer whilst also reducing long term environmental impacts and clean-up costs.
10. Leave me Alone – 2017 saw a dramatic increase in the availability and adoption of Blockchain technology-based personal privacy management applications. By year-end these are increasingly used by individuals to secure their own communications and information storage to avoid sharing data with massive corporations such as Facebook and Google. Brand new business opportunities could emerge for providers that can offer these cutting edge privacy protection services.

The Economy and Business

11. Corporate Flight – Uncertainty over Brexit leads several major companies to announce that they are moving their headquarters, R&D functions and core operations to Dublin, Amsterdam, and Frankfurt. The exodus is well underway by year end. If large high earning corporations leave en masse, there will be a dramatic impact on projections for long term GDP growth and potentially violent fluctuations in share prices.
12. Wealth Haven Britain - Taxes are so 1990’s – to help cushion the expected economic impact of Brexit, the UK government tries to retain and attract foreign investment and wealth. The key pillars of the strategy are the introduction of the lowest corporation taxes in the G20, with massive increases in tax allowances for both R&D and establishment of local production facilities. In parallel, a range of personal taxation measures are introduced that make Britain look highly attractive when compared to the best of the offshore tax havens. Britain will face huge opposition from other countries if it chooses to undercut them with its tax regime. However, this could also see rapid acceleration of foreign investment and the arrival of private foreign wealth.
13. Masters of the Universe - The major technology players such as Google, Baidu, IBM and Amazon continued to pull away from the pack with ever-more sophisticated technology applications. These range from super intelligent ‘brain in the cloud’ solutions to extract insight from the wealth of data being created by the Internet of Things, to smart assistants managing our daily lives and instantaneous translators covering over 50 languages. These new hyper-personalised services could accelerate revenue growth and boost share prices.14. Digital Dementia – In 2017, the corporate sector and many governments continued to adopt a somewhat cautious approach to the use of disruptive technologies such as blockchain and AI. Those who are pursuing expensive digital transformation projects began to see that their initiatives are eliminating the distinguishing human element and effectively commodifying everything they do - as digital differentiation is impossible to maintain. Stock markets began to write down the value of firms that appear to have got lost in this digital maze – whilst advocating those that appear to be using the technology to support talent rather than replace it.

15. Parallel Worlds – A parallel universe of new economy businesses emerges here on Earth. Digital era mindset firms proliferate – trading with each other using Blockchain contract systems, transacting in digital currencies, deploying AI for core activities, and – in some cases – creating entirely digital Decentralised Autonomous Organisations with no physical employees. In the face of broader uncertainty over the future of mainstream businesses, we could see a significant amount of corporate investment and venture capital money flowing to such businesses.

16. The New Professionals - A raft of AI client advisor applications are launched by the major legal, accounting and consulting firms – automating tasks previously performed by professionals and driving a reduction in headcount. This may induce a reduction in the pricing of services from these firms – but could simultaneously drive significant growth in revenue as they can offer these services to more clients in parallel without having to increase headcount.

Social and Leisure

17. Technological Unemployment – The use of new smart technologies, coupled with increasing automation and the termination of ‘non-viable’ activities by large businesses, sees unemployment rising across a range of sectors in countries around the world. This could have a dual impact – both on the level of debt in society and average incomes.
18. The Crumbling Middle – Stalling growth, technological unemployment, The Trump effect, Brexit uncertainty, and general cost cutting bites hardest in the educated middle classes in professional and managerial roles across the developed world. The impact is felt in areas as diverse as theatre attendance and private school enrolments through to the purchase of new cars and holidays.
19. Virtual Immortality - Holographic versions of David Bowie and Prince go on tour. A student team were able to generate new stage performances for these and other artists using previously unreleased tracks and composite digital imagery. A crowdfunded campaign raised enough money from fans to finance a global tour for Bowie and Prince. Holograms of the stars toured the planet, occasionally doing duet gigs together. The use of Virtual Reality and Augmented Reality allows for viewers to purchase VIP and Platinum VIP passes that put them in the front row on even on stage for the performances. These brand new markets will create new pricing opportunities – could these holographic experienced be priced similar to an original stadium concert, or would they be more aligned with the cost of attending the cinema.
20. Robo-Retail -The traditional shopping model was subverted as the Amazon Go concept store was rolled out across the US. Using smart phone technology, item tracking and mobile payment methods, shoppers simply pick up their desired items and leave - the purchases being automatically logged and their accounts debited. The stores saw roaring trade, with customers spending much higher amounts than they normally would, with Amazon’s more traditional competitors forced into a near permanent ‘black Friday’ mentality of continuous discounting. This could drive significant growth for the early adopters – but may see a significant decline in revenue for the slower moving competitors.

About Fast Future Publishing

At Fast Future Publishing we develop our books using an exponential publishing model, and we have completed the successful launch of our first two books – The Future of Business (top five per cent of all business books in its first year), and Technology vs. Humanity (Amazon bestseller within one week of launch).

We are a new breed of publisher founded by three futurists – Rohit Talwar, Steve Wells, and April Koury. Our goal is to profile the latest thinking of established and emerging futurists, foresight researchers, and future thinkers from around the world, and to make those ideas accessible to the widest possible audience in the shortest possible time. Our FutureScapes book series is designed to address a range of critical agenda setting futures topics that we believe are relevant to individuals, governments, businesses, and civil society

Rohit Talwar, Founder and CEO

Rohit Talwar is a global futurist, founder of Fast Future and an award-winning speaker noted for his provocative content. He advises global firms, industries and governments on how to survive, thrive, spot and manage emerging risks and develop innovative growth strategies in the decade ahead. His interests include the evolving role of technology in business and society, emerging markets, the future of education, sustainability, and embedding foresight in organisations.

Katharine Barnett, Concept Editor

Katharine works on creating, developing and editing a variety of content for Fast Future Publishing. She has a broad range of futurist interests including societal and behavioural norms, digital and information ethics, biomedical ethics, genomics and pharmacology, and the future economies of the developing world.

Commenting on the Chancellor’s package of measures to support UK fintech, including a £500,000 a year investment for fintech specialists, Warren Mead, Global Co-lead Fintech, KPMG, comments:

“The UK is a leading global force in fintech but we’re losing power to China rapidly and the announcements in the Autumn Statement will struggle to reverse the trend.

“UK fintech investment has seen a considerable decline throughout 2016 as investors keep a keen eye on the aftermath of the EU referendum and the UK’s changing relationship with America. In fact Europe has not registered a single mega-round (US$50m+ ) in 2016 while Asia has registered 12.* The rise of China is indisputable and picking up pace, four of the top five spots on this year’s top 100 fintech firms were held by Chinese companies.

“Across financial services we’re hearing people talk about technology investment but change is happening too slowly. If we look at banks, they invest just 1-2 percent of their revenue into research and development whilst in technology firms it’s more like 10-20 percent. When one of the technology giants like Google turn their attention to fintech in a serious way we will see dramatic change and it will happen fast. The question is whether Asia will be first? With the diversity of investments and widespread support for the growth of fintech hubs in the region, it’s a very distinct possibility.”

(Source: KPMG)

AZB & Partners is one of the most prominent law firms in India, with a leading and diverse investment funds and asset management practice. AZB advises fund managers, sponsors and financial advisors on a broad range of issues, including fund formation, capital raising, investments, carried interest structures and schemes, co-investment and feeder fund structures, key-person events and fund-related regulatory and compliance matters. The Firm also represents (Indian and international) investors on their participation in funds and investment programs which invest in the Indian region. Here Anooshree Sinha and Ganesh Rao talk to Finance Monthly about the challenges surrounding the set-up of funds in India, as well as legal regulations and trends within the sector.

How are most funds structured in India for private investors? What are the particular advantages of setting up a fund in India?

Funds and/or privately pooled investment vehicles in India are regulated by SEBI (the Indian securities regulator) primarily under the alternative investment funds regulations (AIF Regulations). Per the AIF Regulations, an alternative investment fund (AIF) can be established in the form of a trust, company, limited liability partnership or a body corporate, in accordance with the relevant Indian legislations governing such vehicles. AIFs are typically structured as trusts in India, owing to certain legal and regulatory dispensations. A trust does not have a separate legal existence and the trustee is the legal owner of the trust property who holds such property for the benefit of the beneficiaries (i.e., the investors, who have beneficial interest in the trust property). The trustee typically delegates its functions relating to investments and divestments to the investment manager under an investment management agreement.

The Indian government has, over the past year, been actively encouraging fund managers to set up funds in India and have introduced a number of measures to encourage this. India-focussed funds may be structured both domestically and/or offshore. Structuring India-focussed funds onshore may be advantageous, given that management costs are typically lower, the fund typically itself is treated as a pass-through entity and income distributed is therefore taxed in the hands of the investors. Further, given that limited partners usually mandate that their key-persons to be on the ground and near the portfolio, India domiciled funds have become prevalent. Fund managers also consider setting up domestic funds to tap capital from a pool of domestic institutional investors, including state-owned and private financial institutions and insurance companies. Exchange control laws have been liberalised to allow off-shore investments into AIFs without the requirement of governmental approvals, which lends further reason to establish funds in India. Several factors need to be considered to arrive at the optimal fund structure, including the fund’s objectives, tax implications for the fund managers (on carried interest and net management fee), regulatory and fiscal risk management for the fund and investors, target investors for capital raising, governance rights and ease of structuring portfolio investments and exits.

What are the legal requirements for setting up a fund? How does the current regulation impact the process of setting up a fund and what licenses are required?

All AIFs are required to be registered with SEBI under the appropriate category (depending on their investment objective and strategy) as specified under the AIF Regulations. This process can be carried out by filing the prescribed application form containing details about the AIF entity, sponsor, manager and supporting documents, along with the fees as prescribed in the AIF Regulations. A draft private placement memorandum, containing material information about the AIF, and relevant extracts of the constitutional documents of the AIF permitting it to carry on the activity of an AIF, are also required to be submitted. The AIF Regulations require SEBI to respond within 21 working days of filing the application. Under the AIF Regulations, before commencing any activities as an AIF, a minimum commitment of INR 200 million is required to be raised by the AIF. Under the AIF Regulations, the sponsor or manager are required to maintain a minimum continuing interest in the AIF depending on the category of registration of the AIF. In addition to the registration required with SEBI, an AIF would be required to obtain applicable tax registrations such as permanent account number, tax deduction and collection account number and service tax registrations.

How has increased regulation affected fund managers and investors? How do you assist investment managers navigate the increasingly complex regulatory landscape?

Fund managers for pooled investment vehicles in India are regulated by SEBI under the AIF Regulations and/or relevant regulations for mutual fund, real estate investment trusts or infrastructure investment trusts, and collective investment schemes, subject to the nature of the pooled investment vehicle. Additionally, SEBI also regulates management or advisory entities that provide services on an individualised basis under the relevant regulations for investment advisors, research analysts and portfolio managers, subject to the nature of the services proposed to be undertaken by such entities. Investment managers to AIFs are not required to obtain registration independently with SEBI. However, SEBI regulates such investment managers through the obligations imposed on them under the AIF Regulations such as obligations to act in a fiduciary capacity towards its investors, establish policies and procedure for mitigating conflict of interest, and comply with reporting requirements prescribed under the AIF Regulations. The increased regulations applicable to fund managers have been framed by SEBI with the objective of ensuring transparency and disclosure of information to investors.

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Small, medium, and large companies alike in Singapore have been struggling for some time now, and OCBC Bank hasn't been immune to the declines. Unfortunately, economic conditions in the region have been far from positive to say the least, and when it comes to corporate growth, it is something that economic conditions must support. Unfortunately for the STI as a whole, and companies in the banking and financial services sector like OCBC Bank, it seems as though more declines are on the horizons. Recent economic news was released from Singapore, showing that the economic struggles in the region are far from over. Today, we'll talk about the data that was released, what it means for OCBC Bank moving forward, and what it means for the STI as a whole moving forward. So, let's get right to it...

Recent Economic News From Singapore

As mentioned above, the economic conditions in the Singaporean region haven't been positive to say the least. Unfortunately however, things seem to have gone from bad to worse with the country's most recent economic release. In the first quarter, it was announced that the economy in Singapore grew by 1.8% on a year over year basis. At first glance, that seems like incredible growth. However, when we look at the quarter over quarter view, things aren't quite as appealing as they seem.

On a quarter over quarter, seasonally-adjusted annualized basis, the fact that economic struggles in Singapore are far from over becomes incredibly clear. Looking at it from this angle, we see that the Singaporean economy actually only grew by 0.2% in the quarter. This shows a drastic slowdown from the 6.2% we saw in the previous quarter.

The Singaporean Ministry of Trade and Industry believes that the declines in economic growth are the result of global economic hardships. Here's what the Ministry had to say in a recent note...

“The Global economic outlook has weakened since early 2016, with global growth for the year now expected to be broadly similar to that in 2015. In particular, the growth outlook for the advanced economies has deteriorated marginally...”

What This Means For OCBC Bank

When it comes to the banking and financial services sector, companies are heavily swayed by economic conditions in the region where they do their work. After all, banks make the majority of their money in two ways, and both of them are heavily affected by economic conditions...

• Market Commissions – Investment banks make the most money when economic conditions are positive. That's because these banks make their money through commissions on the investments their clients make. When economic conditions are positive, investors tend to take a more aggressive approach, leading to larger revenues for the banks they work with when making their investments. However, when economic conditions are negative, investors simply aren't as active. This generally leads to declines for investment banks.
• Interest On Loans – Another way that banks drive the money in is through interest on loans. When economic conditions are positive, consumers tend to take out more loans, and perhaps more importantly, pay their loans on time. However, under negative economic conditions, consumers are less likely to take out loans, and many loans go into default, harming banks.

Given the ways that banks like OCBC Bank make their money, it only makes sense that the tough economic news out of Singapore is likely to have an increasingly negative affect on the value of OCBC Bank and other banking stocks in the Singaporean region.

The STI As A Whole Is Likely To Continue Struggling

Throughout most of the year, the STI has been riding downtrends as it still works to recover from the global market declines felt early on. Unfortunately however, it seems as though more declines are coming. With tough economic conditions on the forefront, there's simply not enough supporting growth in the index at the moment.

What Do You Think?

Where do you think OCBC Bank and the STI are headed moving forward? Let us know your opinion in the comments below!

The final design for the new Bank of England £5 note, which will enter circulation in September, will feature the image of Sir Winston Churchill. The new note will be made of plastic rather than cotton paper, which is believed to be cleaner, more durable and harder to counterfeit than the current cotton paper banknotes.

However, the use of new material might create difficulties since the notes may initially be prone to stick together. Although countries such as Scotland, Australia and Canada have been using the thin, see-through polymer, plastic banknotes are brand new to England.  The new polymer notes, which are 15 % smaller than the current ones, will be accompanied by advice to businesses about dealing with them.

The decision to feature Churchill was made three years ago. Churchill’s declaration "I have nothing to offer but blood, toil, tears and sweat", a view of Westminster and the Elizabeth Tower from the South Bank, the Great Clock and a background image of the Nobel Prize are all present in the artwork on the banknote. It will take a year for the new note to completely replace the current 329 million Elizabeth Fry £5 notes in circulation.

Plans for other notes include featuring Jane Austen on the new £10 note which will be issued in 2017, and JMW Turner who will appear on the next £20 banknote expected by 2020. New polymer banknotes are being issued in Scotland as well.

Daniel Tannenbaum at Tudor Lodge Consultants talks us through the latest changes in the UK payday loan industry, including new FCA regulation and authorisation guidelines, and what that will mean for the industry. 

The UK’s payday loan industry has seen a huge transformation. The once thriving and highly profitable £2 billion sector has seen major changes to its regulatory framework, advertising and profit margins – causing payday giant Wonga to record losses of £80 million this year and further reverberations for the industry.

New regulation from the Financial Conduct Authority

The FCA began regulating the payday loan industry in April 2014, taking over from The Office of Fair Trading. Following 29,000-payday loan related complaints recorded by The Citizens Advice Bureau in 2014 and pressure from politicians and religious figures to contest usurious rates, and a tough stance was implemented.

The regulator reviewed the practices of the some of the biggest lenders, which inevitably led to £220 million fine for Wonga, £20 million for Cash Genie, £15.4 million for Dollar Financial, and £1.7 million for Quickquid. The fines were partly to the regulator and some amounts were required to refund customers that should not have been lent to in the first place.

To address the high rates of interest, the FCA introduced a price cap in January 2015. This limit on what lenders could charge was fixed to 0.8% per day and ensured that customers will never have to repay double what they have borrowed.

Other rules included a maximum default charge of £15 and no options for rollovers, which commonly caused customers to keep borrowing at high rates even if they were unable to repay their debts.

The enforcement of this price cap has caused much lower profit margins for payday lenders, which trickled down to all other brokers and introducers involved. Notably, the industry-leader Wonga reported a loss of £80 million in 2015.

Authorisation required to continue trading

The FCA required all companies wishing to participate in the payday industry to apply for formal authorization. Firms could apply for interim permission as a short-term solution with the long-term aim to receive full permission provided that the company’s procedures, staff and product had been fully approved by the regulator.

As firms were granted permission in Q1 of 2016, the most responsible lenders have prevailed whilst several lenders and brokers have been forced to exit due to not meeting the criteria or because they do not believe they can be profitable under the new regulation.

Google bans payday loan adverts

To put further pressure on the industry, Google made an announcement in May 2016 that they will be banning all paid adverts on their search engine for all payday loans related products. This includes any loan term that is less than 60 days or has an APR higher than 36%, including logbook loans and guarantor loan products. (Source: GuarantorLoanComparison)

This change will impact hundreds of payday loan lenders and introducers that pay for adverts on Google to generate leads. Instead, they will have to fight for the very limited positions on Google’s organic search listings, which can be tough to break into for new and old entrants.

The future of the industry

The measures that have been introduced are effectively removing the least compliant players from the industry, keeping the most responsible in the game and creating a barrier to entry.

Further adjustments might be made including tighter rules on Continuous Payment Authority, the automatic collection system used by lenders which might be replaced by a simple direct debit.

Other changes involve more loan companies providing long-term loans like Mr Lender and Wonga, that allow you to borrow for up to 6 months with the option to repay early. The FCA has also emphasised the importance of comparison sites to allow borrowers to compare the different costs and options before applying.

Data from Worldpay, the UK’s leading payments processor, reflects a significant shift in the way British consumers are paying for goods, with High Street credit and debit card transactions rising just over 6% in 2014, following similar gains the previous year.

Londoners are responsible for the single biggest year on year rise in card spending. Transaction volumes on credit and debit cards in the Capital have risen by 9.3% in the past year. Cosmopolitan Leeds is not far behind however, with card-based payments rising by 8.9% in 2014, while Reading (8.0%), Southampton (7.9%), and Liverpool (7.7%) are also creeping towards the cashless tipping point.

Worldpay believes a migration of low value cash payments to card, alongside increasing use of contactless are pushing the UK closer to the point where cards overtake cash as the dominant payment method on the High Street. Recent data from the British Retail Consortium suggests cash use is down by 14% over the past five years across the UK.

Worldpay’s claims are backed by its data which shows a steady decline in average transaction values for credit and debit cards, from £31.51 in 2012, to £29.67 in 2014, an overall drop of 6%. In the fast-growing contactless sector meanwhile, where the number of transactions processed has risen by 150% in the last six months, transaction values have levelled out at around £7.24.

Cash may not be quite done with yet, but it is clearly losing its appeal, particularly among tech-savvy Gen Y’ers. Worldpay research of 2000 consumers found the majority of Brits over 45 years old still like to have cash on them, nearly 60 per cent of 25-to-34-year-olds would prefer to never carry cash.

The Financial Conduct Authority (FCA) has imposed a financial penalty of £284,432,000 (€400 million) on Barclays Bank Plc (Barclays) for failing to control business practices in its foreign exchange (FX) business in London. This is the largest financial penalty ever imposed by the FCA, or its predecessor the Financial Services Authority (FSA).

Barclays’ failure to adequately control its FX business is particularly serious in light of its potential impact on the systemically important spot FX market. The failings occurred throughout Barclays’ London voice trading FX business, extending beyond G10 spot FX trading into EM spot FX trading, options and sales, undermining confidence in the UK financial system and putting its integrity at risk.

Georgina Philippou, the FCA’s acting director of enforcement and market oversight said: “This is another example of a firm allowing unacceptable practices to flourish on the trading floor. Instead of addressing the obvious risks associated with its business Barclays allowed a culture to develop which put the firm’s interests ahead of those of its clients and which undermined the reputation and integrity of the UK financial system.  Firms should scrutinise their own systems and cultures to ensure that they make good on their promises to deliver change.”

Between 1 January 2008 and 15 October 2013, Barclays’ systems and controls over its FX business were inadequate. These behaviours included inappropriately sharing information about clients’ activities and attempting to manipulate spot FX currency rates, including in collusion with traders at other firms, in a way that could disadvantage those clients and the market.

Barclays and other firms are already participating in an industry-wide remediation programme to ensure that they address the root causes of the failings in their FX businesses and that they drive up standards.