Attempts have been underway in Parliament recently to help tenants improve their creditworthiness. This includes new legislation to make lenders give rental payments the same weight as mortgage premiums, including most recently Big Issue founder Lord Bird’s draft Creditworthiness Assessment Bill.

Open Banking - ahead of any future legislation - offers tenants the potential to achieve improved creditworthiness at no extra cost.

The launch of Open Banking in the UK last month, backed by nine key UK banks, is now enabling renters who want to get a mortgage to improve their creditworthiness with an ease that would have been unimaginable only a year ago, says CreditLadder.co.uk.

Instead of onerous paperwork or agent/landlord permissions - as has been the case in the past - tenants are now able to report their rental payments via mobile/online platforms simply, quickly and for free.

Tenants tell their bank they want the platform to ‘read’ their rental payments and pass this information on to a credit reference agency, such as Experian.

“When we launched our Open Banking service last month we were acutely aware that the take up maybe held back given the newness of the technology,” says CreditLadder CEO Sheraz Dar.

“But so far Open Banking is proving popular with our customers. The number of people signing up to our service has doubled and last week 80% of those applying to join our service now do so via Open Banking.

“Many of the UK’s 11 million private renters are finding it harder and harder to get on the property ladder, so it’s no surprise that a service like ours which gives them a leg-up is proving popular.

Case study

Civil Servant Ian Cuthbertson, 33, from Norwich is the first person in the UK to sign up and register his rental payments with a credit agency using CreditLadder’s Open Banking service, which is provided through an FCA-regulated partner.

Ian pays £700-a-month for a two-bedroom barn conversion he shares with his partner on the outskirts of Norwich, payments that are now being added to his credit history via CreditLadder.

“My partner and I are planning to buy a home in a few years’ time so I’ve been realising more and more that I need to improve my chances of getting a mortgage,” he says.

“So I’ve been looking at how I manage my credit cards and trying to make little tweaks here and there to my finances so that I present myself as trustworthy to lenders.

“I was thinking to myself that I pay the rent on time every month and wondered if that could count towards my credit score. And then I saw an article on MoneySavingExpert.com about CreditLadder so I decided to sign up.

(Source: CreditLadder)

Financial professional and Founder of Texas-based Hybrid Financial Rocky Campbell established his company to offer premier retirement services and believes in doing business with integrity. Below, he discusses the financial services that his company offers, as well as his tips for a well-organized retirement plan.

Please tell us a little about the financial services that you help clients with.

While Americans are presented with an ever-changing financial marketplace, making the right financial decisions at the right time can be critical to achieving their financial security and accomplishing financial objectives. Hybrid Financial will guide the process of identifying financial goals, account organization, risk analysis, and problem solving to help their clients accomplish their financial goals safely and simply.

What would you say are the specific challenges of assisting clients with financial solutions?

Not every client is a right fit us and realising that from the start will save both of us time. I’m not the jack of all trades I’m a specialist. Specifically, a specialist in safe money solutions and income producing retirement strategies. I’m real - I don’t tell people what they want to hear. I stick to a single message - safety of principal. I’m a hardworking and straightforward person I believe that if you do the right thing for people, things will work out for you.

What are the most important aspects that need to be ironed out in order to achieve satisfactory result and a well-organized retirement plan for your clients?

We form a strategy that will best fit the client’s needs and will help them feel confident about their financial future.

How do you assist clients with finding out if they are compliant with federal requirements applicable to retirement?

Compliance is important. Our compliance officer will ensure that as the world changes around us, we change with it and notify our clients of any regulations that need to be adhered to.

How can your clients ensure that as much of their estate goes to their family on their death?

We use beneficiary driven products that bypass probate and go directly to the named beneficiary. We believe that all money should go to the family. A living will, or trust can also assist in providing clarity during time of death.

What’s Hybrid Financial’s philosophy?

I don’t do things that I don’t really, really believe in. And something I believe in is the message of the tortes and the hare. Now the hare was fast, but the tortes won the race. Slow and steady wins the race. If we can prevent our clients from going backwards and losing any of their assets to fees and stock market declines, they have more power to win the money game. That’s what I do - I help people slowly and steadily win their financial race, one person at a time.

With financial services going increasingly global, companies are now doing business all over the world. While this presents a bounty of opportunity, it also throws up a fair share of risk, particularly when it comes to the tricky question of travel etiquette.

Economies from established to emerging each have their own cultural norms and social mores — make one (unintentional) error and you could land yourself in an embarrassing situation, hot water or something far more serious indeed.

Today, forward thinking companies are becoming increasingly aware of travel etiquette. As firms spend financial resource on sending their staff abroad for meetings, training and networking, they are focusing on ensuring that their employees are fully up to speed on professionalism and understanding.

After all, when deals are being signed, made or broken and contracts are based on the outcome of a successful meeting, it’s more crucial than ever that everyone present knows how to present themselves, communicate properly and engage their audience. So what is travel etiquette in the finance sector?

Travel etiquette is about understanding local customs

While some people may think that globalisation means that customs and norms have become identikit, go out into the world and you realise that really isn’t so, especially when it comes to doing business. Each and every country has its own business etiquette, and it’s important you’re aware of the intricacies of these, as even a minor slip can have serious consequences. This useful resource from travel experts Expedia gives you lots of little tips for getting business meetings right when you’re in undiscovered country. In Turkey, for example, small talk is considered important in business meetings, so don’t jump straight into business-talk!

Travel etiquette is about mutual respect

Unprofessionalism can cost you business. But professionalism can help you grow. Understanding travel etiquette helps financial service firms treat people with respect, admiration and decency. In today’s fast-paced world, such traditional values, some say, are fading out. Practicing good travel etiquette helps you forge connections with people in different countries, network appropriately and set strong standards of performance and quality.

Travel etiquette is about empowering and inspiring your employees

Upskilling your employees in travel etiquette not only minimises the risk of an awkward business meeting peppered with social faux pas, it means you’ll be helping them become rounded individuals and employees with a thirst for knowledge. Workers confident about travelling to a new country and negotiating, selling or pitching for business will feel inspired and ready to take on any challenge. This improves them as people, and it improves them as employees, giving them the skills and knowledge they need to help grow and develop your company.

Here's five tips for travel etiquette in the finance sector:

1. A handshake is still important

We might have ditched the formal dress code, titles and everything else, but a handshake should still be considered an essential when doing business. It takes little effort and, as we all know, a little goes a long long way.

2. Don’t interrupt people

In competitive industries, interruption isn’t uncommon. But far from making you look ambitious and driven, in most cultures it simply makes you appear rude and unprofessional. If you’re ever tempted to interrupt someone when they’re part way through a sentence, think twice, and wait until they’ve finished before making your point.

3. Avoid using your phone during meetings

The rise of the smartphone means many of us now use our personal devices more or less all day. And they’re an important tool when it comes to doing business, as we use them for sending emails, making calls and more. But when it comes to a meeting, put the phone away. Even if you’re doing something work-related, it looks like you’re distracted and would rather be elsewhere.

4. Greet everyone

When meeting a large delegation of people, it can be easy to overlook a couple of individuals when it comes to introducing yourself. However acknowledging everyone is a basic sign of respect, regardless of their status or job title, and ensures you don’t look like you have a superiority complex. Respect across all levels of any organisation and is crucial.

5. Say please and thank you

It sounds obvious, but you’d be surprised how the simple act of saying please and thank you is a dying art. Manners cost nothing, so be polite at all times.

The need for financial institutions to be prepared against cyberattacks is doubly pressing this year, following a raft of new regulations. These have shifted the mandate from one of annual compliance exercises to an ongoing assurance that IT systems are prepared and secure.

Hiscox recently published its Cyber Readiness Report, surveying how prepared major institutions are to face cyber-attacks. Last year the report found many businesses underprepared for cybersecurity threats.

A variety of products offer security for financial services companies’ critical applications. But the growing complexity of banks’ systems means that the approach to cyber security products is not fit for purpose, warns systems integrator World Wide Technology.

Nick Hammond, lead advisor for financial services at World Wide Technology, comments: “The Hiscox report will serve as an important reminder to financial services firms about the importance (and difficulty) of securing against the cyber threats.

“This kind of protection is all the more necessary this year, in the wake of new regulations such as MiFID II, PSD2 and GDPR. Unlike older rules that only required yearly tick-box compliance exercises, these new regulations require continued assurance of critical applications.

“But with the complexity of existing IT systems, which have been built with different and sometimes opposing metrics over the years, this is easier said than done. Legacy infrastructures are often formed from an extremely complex patchwork of applications, which communicate with each other in convoluted ways.

“This web of opaque interdependencies is creating problems for cyber security. Without a clear view of how the system is plumbed together, there can be knock-on effects downstream when one application is prevented from sharing data with another system or user.

“To meet changing regulatory requirements, companies in the financial space need to access infrastructural expertise, to generate a working, real-time picture of the entire framework. Only after gaining this level of visibility can the right security policies be fitted to each application in a way that fits within the functioning of the existing system, allowing components to communicate as they need to whilst closing them off from external threats.”

(Source: World Wide Technology)

As we herald a new era of banking, will PSD2 result in FinTechs challenging the dominance of traditional banking services?

13^th January 2018 marked the beginning of the Open Banking era. The EU’s Second Payment Services Directive (PSD2) which took effect earlier this month forces banks to allow third parties, including digital start-ups and challenger banks, access to their customers’ financial data through secure application programming interfaces (APIs), and create a new way for customers to bank and manage their money online. If all goes to plan, PSD2’s main objective is to ensure maximum transparency and security, whilst encouraging competition in the financial industry. The Open Banking revolution aims to create a form of cooperation between banks and FinTechs – however, this doesn’t seem to be the case 18 days after the triggering of PSD2, with a number of banks that still haven’t published their APIs and incorporated the necessary changes. Naturally, the directive is good news for the FinTech sector. FinTech companies and digital payment service providers will gain greater access to high-street banks’ customers’ financial data – something that they’ve never had access to in the past. This will then undoubtedly inspire FinTechs to develop new innovative payment products and services and provide users with opportunities to improve their financial lives, whilst allowing them to compete on a more-or-less level playing field with the giants of the financial services industry, the traditional banks. Does this mean that traditional banks will need to up their game when competing with the burgeoning FinTech industry? Are they scared of it, and if not – should they be?

Traditionally, and up until now, banking has always been a closed industry, monopolising the majority of other financial services. The recent advancement of digitisation has shaken the industry, with FinTech start-ups offering alternative solutions to more and more clients across the globe. From a bank’s point of view, PSD2 will forever change banking as we know it, mainly because their monopoly on their customers’ account information and payment services is about to disappear. Banks will no longer be competing against banks. They will be competing against anyone that offers financial services, including FinTechs. And even though the directive’s goal is to ensure fair access to data for all, for banks, PSD2 poses substantial challenges, such as an increase in IT costs due to new security requirements and the opening of APIs. However, the main concern is that banks will start to lose access to their customers’ data.  Alex Bray, Assistant VP of Consumer Banking at Genpact believes that a possible outcome of Open Banking is that banks could end up surrendering their direct customer relationships. If they don’t acknowledge the need for rapid change or move too slowly to adapt to the landscape, they risk becoming “commoditised payment back-ends as new aggregators or payment initiators swoop in”.

However, Alex Bray also argues that for banks to take advantage of PSD2, “they will need to find a balance between openness, privacy and data protection.” There is also a case to suggest that traditional banks who embrace and utilise the new directive to its potential could transform a potential threat into a huge opportunity. He also suggests that: “they [banks] will need to improve their analytics so they and their customers can make the most of the huge amounts of new data that will become available”. Only a well-thought-out strategy will help banks to survive the disruption to the long-established financial industry – and cooperating with FinTechs can be part of it. Alex Kreger, CEO of UX Design Agency suggests that “Gradually, they [banks] could turn into platform providers of banking service infrastructure… As a result, successful banks may lose in service fees, but they will gain in volume. Many FinTech start-ups will not only offer services on their platform, they will actively introduce innovative products designing new user experiences, thereby enriching the financial user’s journey and transforming the banking industry. This will attract new users and provide them with new ways of using financial instruments.”

Only time will answer all the outstanding questions related to the open-banking revolution. FinTech firms are expected to ultimately benefit from all these changes – however, whether the traditional banks will cohere to the new regulations quickly enough, whilst finding ways to adapt to them, remains to be seen.

Bhupender Singh, CEO of Intelenet Global Services, explores the developments in automation and other technologies for financial services.

This year, the pressure is on for banks to keep up with the latest innovations in technology. The Second Payment Services Directive (PSD2), requires banks to have systems to share their customer data with competitors in place, and allow third party players to process payments. This comes as part of a wider Open Banking Initiative, to open up the financial services market to competition from innovative challengers and Fintech players.

The General Data Protection Regulation (GDPR) will also require huge technological preparedness as companies put in place new data management programmes to wipe customer data on request and detect data hacks within 72 hours.

So far this has proved difficult. Saturday 13^th of January was the original deadline for UK banks to become compliant with PSD2. But five of the UK’s major banks do not have the correct technology in place to be ready in time, and have had to secure an extension from the Competition and Markets Authority (CMA).

And there is pressure coming from competitors, as well as regulators. New challenger banks and Fintechs have been growing in popularity and drawing away customers from traditional banks, service by service, through personalisation and agility.

PSD2 will only increase this challenge, allowing these challengers access to customer data, drawing tech giants such as Amazon and Facebook into play, and facilitating the aggregation of financial data on comparison sites. This will give customers a clear view of where they can get quicker service or make savings with other providers, so traditional banks will be looking to harness the latest technology to keep their services agile, user-friendly and inexpensive.

In response to this, many banks are investing in updating their processes to match the agility and tech capability of their challengers – but they are often hindered in doing this by clunky legacy systems, struggling to patch new technology onto existing infrastructure.

To solve this issue, financial providers are increasingly turning to the help of business process outsourcers. Shifting away from a cost-cutting mentality, BPOs are now driving innovation throughout the finance industry. In fact, the market for outsourcing in Banking and Financial Services is estimated to grow at a rate of 6.79 per cent annually until 2020, when it is forecast to be worth $4.9bn.

Outsourcers are leading the way by bringing innovation into banking processes to drive technology adoption. On a macro level, by migrating data to the cloud and using automation to create a connected financial data ecosystem, outsourcers can help generate a holistic overview of areas of performance. This makes data management simpler, so that GDPR compliance is easier. It also allows for more informed decision-making. Personnel can see the whole picture and draw further insight on decisions. This means that additional tools such as predictive analytics can drive businesses to focus on their growth and financial success.

As financial services providers face increasing competition from the agile service of challenger banks and Fintechs, the pressure is on to speed up and improve service. Automation allows traditional banks to compete on a granular level by improving the quality of each service. One example is the developments in mortgage approvals. Once requiring complicated systems of referral and human judgement, this administrative process can be thoroughly automated, linked up with the relevant data to radically reduce waiting time for the customer. With the help of an outsourcer, one leading UK bank was able to cut down approval times from 11 days to a matter of 48 hours.

New competitors have also been attracting traditional banks’ customers by offering an increasingly personalised service. But using outsourcers, banks can optimise the reach of their in-person service – an advantage against new, smaller challengers. Many are making use of voice-recognition software that recognises a specific customer, matching this to their personal data and, using AI programmes that make conclusions about the likely subject of their call, automatically forwards calls to the best place. This reduces the friction customers face when being passed manually between departments and points of contact.

As this reduces the need for a human operative to redirect calls, this instead enables staff to refocus their energies on more sophisticated customer service requests, managing relationships with consumers to promote business growth in an interpersonal way, to keep up with new competition.

Driven by outsourcers, automation tools are allowing finance teams to cut down the time taken to process complex transactions and administrative tasks. By streamlining front-end and back-end processes with these kinds of programmes, outsourcers are helping traditional banks and finance teams not only to save money, but to radically drive innovation, to compete for customers, comply with regulation, and offer an increasingly rapid and modern offering to their customers.

Matt Crawley is Corporate Finance Partner at accountants, business advisers and financial planners Lovewell Blake, one of the leading independent firms in East Anglia. He works closely with business owners across the region to help them develop and realise strategic aspirations, managing both the process and specialist advisers and lawyers. This month, Finance Monthly reached out to Matt to hear about his business development tips.

What would you say are the three key points for businesses to address when developing their businesses?

The Right People

Particularly for owner-managers, developing the second-tier management team, as well as attracting and retaining key talent, is a big challenge. Often, entrepreneurs baulk at paying for someone to run their business, something they may have been doing for some time, but recognising the necessity of this is a big factor in allowing the business to develop and grow.

 Businesses can be successful, but in order to continue to grow, it is important that the management team is developed. If this does not happen, the leader cannot effectively lead the business and strategically plan for growth. It also means that the routes to an exit plan are blocked: a business with a strong management team is a more attractive prospect to a trade buyer when the founder wants to retire, and if that doesn’t happen, it also opens up the opportunity for an MBO.

The need to retain key talent outside the senior management team is also a big factor, particularly in those sectors where IP is a big issue. Losing a key individual at the wrong time can effectively put the brakes on growth, so it is important to have the right structures in place to incentivise and retain key talent – for example putting in place an EMI scheme so that key people will themselves benefit from business growth.

Making sure you have the right people is just as important as finding new customers when it comes to business development. Often, the most successful growing companies are the ones where the entrepreneur has less to do – so that they can concentrate on driving that growth.

Managing Cash flow

It may seem obvious, but having robust financial systems in place is crucial for business development. Growth, and in particular rapid growth, can drain a business of cash, and many developing businesses under-estimate the amount of funding required to achieve that growth.

The big challenge here is to ensure that you have robust financial projections, which accurately reflect the needs of the business as it grows. Not only will doing so remove many surprises, it will also make it easier to find funding, as lenders and other funders will take a business more seriously if it can demonstrate that it understands the financial challenges inherent in developing itself.

It is important to stress test the assumptions you make in creating these projections, as well as the projections themselves, through scenario planning. Developing a business seldom goes entirely according to plan, and the trajectory for growth can be knocked off course by any number of external and internal factors.

Of course, sourcing the funding for growth is a challenge in itself. Whilst traditional lenders are now more open to proposals than they were five years ago, there are also now more routes than ever to finance, and it is important to explore them all in order to find the one which is right for a particular business.

It is clear that attitudes are changing: for example, younger entrepreneurs are open to the concept of using a discount facility – borrowing against invoices – in a way that an older generation of business owner might not be. Whereas in the past this would be viewed as debt factoring, something which might look as if a business was in trouble, now it is accepted as a legitimate way to raise funding for growth (and in any case is much more discreet than it used to be).

The Right Infrastructure

One of the main challenges in developing a business is to ensure that the infrastructure of the business is suitable for the particular stage of its growth. We often see firms which retain a start-up mindset even as they grow into multi-million businesses.

There are all sorts of infrastructure issues to think about to facilitate business development, from the expertise required to manage that growth; making sure that the business’s premises are suitable to accommodate growth (and finding both the right premises and the funding to move if they are not); a suitable legal framework; and ensuring that the brand is strong enough to be credible with the type of larger customers which growth often brings with it.

Perhaps the two major infrastructure challenges are finance and HR. It’s not just a question of compliance: getting these two right can make a big difference both in the company’s ability to deliver growth – and to do so profitably.

You work with clients from a variety of sectors; are there ways in which their business development needs differ?

Very definitely. All of the above challenges will apply to most growing businesses, but some will be more important than others in any individual sector.

For example:

• Energy – oil, gas and renewables: this is an industry in which external factors, in particular the price of oil can have a huge impact, turning a hugely profitable business into a marginal one, and vice-versa. So when working with businesses in this sector, we emphasise the need for monthly projections, to enable business owners to plan on the basis of the latest environmental factors.
• Tech sector: In East Anglia, the Tech sector is very important, with Cambridge being a well-established tech hub, and Norwich following hot on its heels. Here, the two main challenges are talent retention and funding. Many tech start-ups are dependent on intellectual property, and key individuals can be central to a company’s development. Likewise, funding is often not available via traditional routes, because it’s not about borrowing against pieces of kit. Investors often want to take equity, which needs to be done in a way which will benefit both the business and its founder. The right investors don’t just bring funding, but expertise, structure and ideas as well.
• Food and farming: this is a sector where regular review of KPIs is vital, because small changes made regularly can have a big effect on the ability to grow – and if those changes are not made quickly, they can become major barriers to growth.

What are the main barriers to business development?

Often tackling the challenges I have outlined can be seen by smaller businesses simply as a cost, which can be avoided. But our most successful clients are the ones which are prepared to engage with us and invest in the support needed to make growth happen.

Development support can only come from advisers who genuinely understand the business, who take the time to measure what needs doing – and their own progress towards achieving those goals – and who provide structured advice and a challenge to the entrepreneur.

Website: https://www.lovewell-blake.co.uk

Phil McGovern is the Managing Director of MPA Financial Management Ltd., a financial services company based in Warwickshire, United Kingdom. The firm started in 1998 but since 2010 the company has grown rapidly - from managing £40M to currently managing £380M on behalf of clients. Here Phil tells Finance Monthly’s readers more about the services that his company provides and offers his tips on
retirement planning.

Can you tell us more about MPA Financial Management and the services that it offers?

We believe in employing people who have high emotional intelligence and can relate to normal people. We spend a lot of time and money training our staff to high levels of educational achievement through the CII and we have a strapline of Inform, educate, inspire. We want to inform, educate and inspire our clients and staff to meet their long-term goals of financial and personal satisfaction.

We mainly manage money on behalf of clients in various tax wrappers and 70% of our business is pension-related. We also offer the full range of mortgages, life and health protection but over the years pensions and investments have grown substantially.

We offer 3 main services on the wealth management side:

-MPA Private Client for clients with investable assets in excess of £500,000 pa. They are offered quarterly reviews, access to discretionary fund managers or model portfolios or bespoke offerings. We also arrange special lunches with fund managers and industry speakers and access to other professional services.

-MPA Wealth offers pension and investment services from £75,000 to £500,000. We usually recommend a Model Portfolio service from our panel of MPS (5 companies) which are risk rated against Distribution Technology. Clients will get annual or biannual reviews (depending on size).

-MPA Lite is a cost effective solution for small portfolios which uses 7IMs passive risk rated portfolios, under £75,000 in size.

We also run a post retirement investment solution that combines Prudentials PruFund Growth (40%) with Brewin Dolphin Balanced, reducing volatility down by 2/3 and performance by 1/3 (as against using Brewins only).

We offer whole of market mortgage service and a will writing and probate service. We are increasingly involved in long-term care planning.

We are pension transfer specialists and have advised many clients on the merits of transferring out (or not) of defined benefit schemes.

Can you outline the process you go through to assess your clients’ current financial situation and assist them with identifying financial goals and concerns?

We complete a comprehensive factfind in the early stages trying to ascertain, in the clients’ own words what they are trying to achieve with their finances.

We spend a lot of time trying to work out the clients’ attitude to investment risk and their capacity for financial loss using our own in-house questionnaire.

We then recommend investment solutions that will match their risk and long-term plan and recommend the tax wrappers that are the most tax efficient way of investing the money.

We then ensure that we monitor the performance of the investments, and the tax consequences on an ongoing basis so that they meet their goals. We spend a lot of time communicating with them to keep them happy about their investments and helping them understand how they react as they do

How should individuals plan for early retirement? What options are available above and beyond a pension?

Ideally, they should start early. Many clients come to us just before or at retirement and want us to manage the money for them when the wealth has been built up.

There are many ways to structure a retirement plan. We tend to use ISAs, OEICs, investment bonds, EIS and VCTs to get a balance between risk, reward, income, growth and tax efficiency. We will also use investment property as another asset that can generate income and capital growth.

Advising on DB transfers has become a large part of the advice process in the last 2 years while transfer values are so high and that has to be factored in to the advice process.

In your experience, are individuals fully aware of their assets and worth so that they can take advantage of tax planning? Which types of assets are usually missed?

No, in my experience they do not understand the difference between all the tax wrappers we use. They generally have an idea of worth but we take a lot of time explaining the strategies that we use to maximise returns and minimise tax.

Maximising pension contributions using carry forward is complicated and they don’t understand that. Also, the planning for high-earners’ pensions and the Lifetime Allowance is something they don’t understand.

We maximise ISAs and invest other monies in a general investment account and use this to fund ISAs each tax year. This works up to £250,000 but over this CGT becomes an issue. Therefore, we then use investment bonds as a very tax efficient income generator.

We use AIM portfolios for IHT planning alongside trust work.

What solutions do you offer in respect of maintaining and growing wealth for future generations of the same family?

We can aggregate asset value for family members so that they can benefits from large fund discounts. Discounts start over £500,000 and children with an ISA for £20,000 could get the investment with no initial charge and a reduced ongoing charge with Family Discount.

We have joint meetings with children so that if anything happens we have met them.

Also, trust-based work and long-term care leads to dealing with the children and beneficiaries.

As a Managing Director of MPA Financial Management, what are your key responsibilities? What does a typical day look like for you?

My key responsibilities include managing the day-to-day business, the finances, recruitment, marketing, strategic planning, discipline, investment management and also looking after a large client book.

I sign off all the DB transfers for the company and get involved with compliance and process for DBs.

A typical day would be as follows:

-Wake up at 4am, check the company bank accounts to see what money has come in today;

-Leave for office at 7.30;

-Catch up on emails and paperwork. Probably review sign offs for DB transfers sitting on my desk (usually at least 6);

-Write financial planning report for a client;

-Go on various platforms to check on performance of various portfolios;

-Maybe have a review meeting with a client. Administrator will prepare paperwork, so will check for accuracy. Check Intelliflo back office system for notes of previous meeting. Look at Analytics for research on portfolio;

-Meeting with client lasts usually 1 hour. Pass on notes to admin and any work to do;

-Have meeting with Admin manager for updates on how things are going. Deal with any issues;

-Talk with Office Manager for any logistical issues need to know about;

-Constantly replying to emails from clients or reps;

-May meet with rep from investment company;

-If any spare time, I tend do some investment research or talk to clients;

-Get home at around 6pm and carry on responding to emails I have missed.

What is your vision for the future of the services that MPA Financial Management offers?

I want us to be a firm that is respected countrywide for the levels of service it gives to clients and the level of ethics it employs in dealing with everyone. I want us to help more and more people reach their financial goals without having sleepless nights.

Our long-term target is to reach £1BN in funds under management and to keep striving to drive down investment costs for clients.

Website: http://www.mpafm.co.uk/

The UK’s Banking and Financial sector has ended the year on a positive note, with the growth of new companies up 18.56% to 5,775 and failures down by 37.89% to 59 compared to Q3, according to figures released in the quarterly Creditsafe Watchdog Report. The report tracks economic developments across the Banking and Financial sector and 11 other sectors (Farming & Agriculture, Construction, Hospitality, IT, Manufacturing, Professional Services, Retail, Sports & Entertainment, Transport, Utilities and Wholesale).

In addition, sales were up marginally by 1.24% from Q3, and the number of active companies rose by 6.86% over the same period. Total employment fell by 4.39 in Q4.

The research shows a significant improvement in the financial health of the sector, with the volume of bad debt owed to the sector decreasing by 89.31% in Q4, and down by 81.35% since the same period a year ago. The average amount of debt owed to companies in the sector in Q4 came in at £28,686, which was an 88.35% drop on the previous quarter. There was a mixed picture for supplier bad debt, the volume owed by the sector, which saw a big decrease of 60.71% against Q3, but was up by 51.16% compared to Q4 2016.

Rachel Mainwaring, Operations Director at Creditsafe, commented: “Creditsafe's Watchdog Report shows a much-improved outlook for the UK’s Banking and Financial sector moving into 2018. Last quarter’s levels of bad debt were a serious cause for concern, so it’s extremely positive to see a huge drop in these figures in the final quarter of the year.

“It’s also exciting to see such an increase in the growth of new companies, pointing to an encouraging year ahead for the sector. It will be interesting to see how these new companies fare, and whether these positive figures continue throughout the next few quarters.”

(Source: Creditsafe)

From democratising data to driving value, blockchain has a lot of potential to improve on some of the credit industry’s greatest challenges. Here Alexander Dunaev, Co-Founder and COO at ID Finance, delves into how blockchain could disrupt credit agencies all over the world by providing a solution to address the broken and archaic data practices at the credit bureaus.

Blockchain is driving a paradigm shift in how we deal with data, rewriting the rulebook around approaches to data management, transparency and ownership. While digital finance is cutting the cost of serving the underbanked to drive financial inclusion, blockchain could offer a way of widening access to even greater numbers of consumers excluded from mainstream financial services.

Within lending, where we see blockchain having the biggest impact is on transforming the credit bureaus. The technology offers a much-needed solution to address the inefficiencies associated with data security, ID verification and data ownership.

Credit bureaus are not infallible

Although a number of new ways are emerging to determine loan eligibility, the largest banks and financial services providers still rely heavily on an individual’s credit history, sourced from credit agencies such as Equifax, Experian and TransUnion and its corresponding FICO score. Indeed 90 per cent of the largest US lending institutions use FICO scores.

The way in which credit histories are stored and accessed by corporates has historically made a great deal of sense and offered a multitude of benefits. It regulates how the data is stored, audited and accessed, and bestowing a government seal of approval provides the necessary level of trust among and consumers and contributors (i.e. the banks).

The severity of the recent Equifax data breach however – described by US Senator, Richard Blumenthal as ‘a historic data disaster,’ – where personal records for half of the US were compromised, exposed a number of critical flaws and vulnerabilities. Experian also suffered a breach in 2015, which affected more than 15 million customers.

In spite of the supposedly robust data storage safeguards, the hacks highlight that these databases are simply not safe enough and are certainly not immune from intrusion.

With first hand experience of dealing with multiple credit agencies across the seven markets ID Finance operates, I believe there are three key ways blockchain could address the inefficiencies associated with having a centralised credit system:

1) Reducing the costs and complexities associated with data verification:

Achieving a comprehensive view of a borrower’s financial discipline and credit capability requires extensive verification and evaluation throughout the lending process. This is both time consuming and costly particularly when multiple credit bureaus exist in a country.

As data isn’t shared among the credit agencies, each will inevitably hold a varying report of an individual’s credit history meaning we need to engage with all of the providers to gain a consolidated view of a borrower’s financial health.

The combined revenue of Experian, Equifax, TransUnion and FICO in 2016 was c. $15bn. These are the fees paid for mostly by the banks, to access the credit histories needed to carry out their day-to-day lending activities. In the most simplistic sense this is $15bn of fees and interest charges passed on to, and overpaid by the end user – via higher lending APRs – for the privilege of having access to credit.

At the same time the regulatory compliance surrounding the storage and distribution of credit histories creates high barriers to entry making the market oligopolistic and hence less competitive. It is hampering the ways and locations in which businesses can lend.

In short, we have a process whereby consumers are paying the steep price of having a centralised credit history facility, which isn’t immune to data breaches, while frequently creating hurdles for financial services firms to actually access the data. This process is broken and out-dated.

2) Blockchain as a key value driver in lending:

Blockchain – a tamper-proof ledger across multiple computers with data integrity maintained by the technological design rather than on an arbitrary administrative level – has the potential to address the broken and archaic data practices at the credit agencies.

Until recently there was no alternative to having a robust authority managing the credit database. However, it is precisely the lack of a centralised authority, which makes blockchain so suitable for the ledger keeping activity, and is what facilitated the most proliferated application of the technology within cryptocurrencies where reliability is key.

Storing the data across the blockchain network eliminates errors and the risks of the centralised storage. And without a central failure point a data breach is effectively impossible.

Without intermediaries to remunerate for the administration of the database, the cost of data access drops dramatically, meaning lenders can access the data without having to pay the ‘resource rent’ to the credit agencies.

3) Democratising data and handing ownership back to individuals:

As the data is no longer held in a central repository, ownership is handed back to the ultimate beneficiaries – the individuals whose data is being accessed. Borrowers will have constant and free access to their own financial data, which is rightfully theirs to own, and potentially monetise without the risk of identity theft and data leakages.

Blockchain can address the limitations of the credit system and boost financial inclusion as a result. The technology offers security, transparency, traceability and cost advantages, as well as achieving regulatory compliance and risk analysis.

While it may be too soon to predict the exact impact of blockchain in lending, what is apparent is the centralisation of the credit industry isn’t working. It’s time to rip up the rulebook and start afresh and blockchain offers a compelling solution.

MiFID II came into force at the start of the month/year, but many businesses are still not compliant. Luckily for them, there’s a six month grace period before they’re actually in trouble. With that in mind, here’s 5 top tips for compliance from Joanne Smith, Group CEO of TCC and Recordsure.

MiFID II, hailed as the key to overhauling the financial markets and implementing the lessons learned following the financial crisis, is finally here. The legislation is designed to drive significant changes around transparency, investor protection and effective governance. It also aims to harmonise the various regulatory regimes that exist across the European Union.

With such broad and wide-reaching goals, the legislation, and the changes firms are required to implement in response, are significant and shouldn’t be underestimated. Yes, MiFID II is already in play, but with so much uncertainty in the build-up to implementation, firms may be less prepared than they might have hoped, or uncertain of how to ensure ongoing compliance.

Here are five top tips to help firms set themselves up for ongoing MiFID II compliance and strengthen their business for ongoing commercial success.

1. Make Culture King

There’s no doubt that culture is one of the most important components of effective governance frameworks. Firms that are focussed on treating customers fairly and delivering the right outcomes are more likely to have greater commercial success and a more positive relationship with the regulator than one with a poor culture, or one which isn’t sufficiently embedded throughout all levels of the organisation. Recent FCA thematic output has identified how firms with objective self-challenge built into their processes are able to more effectively demonstrate that good customer outcomes are central to their business.

Firms should have gained a thorough understanding of their culture prior to making any changes to their business in response to MiFID II. However, culture isn’t static, it evolves over time and so firms will need to continually measure and evidence their culture and the impact it has on consumer outcomes. When assessing this, firms should keep MiFID II’s core aims of transparency and investor protection in mind and assess the extent to which internal practices are aligned.

2. Consider the Impact of MiFID II on Future Strategy

Now that MiFID II is here, firms should keep the requirements front of mind when considering any strategic business changes, as the requirements do impact, whether directly or indirectly, on a significant number of business areas.

In the near future, the industry is likely to see changes in the distribution landscape, with firms exploring direct to client offerings and increased use of digital services to serve clients and offset the increased costs the legislation will bring.

3. Get Reporting Systems in Order

The reporting requirements of MiFID II gives firms and regulators greater insight into the market, enabling them to monitor and identify emerging threats and potential instances of market abuse. Given the FCA’s more proactive regulatory approach in recent years, firms should expect to see the regulator pay close attention to how firms are utilising the information collected as part of their MiFID II compliance programmes and its own work to increase the effectiveness of its supervisory approach.

Firms should review their reporting systems and data infrastructure regularly to ensure that they are meeting regulatory expectations. Making full use of the insights available can also be used to inform strategy and ensure appropriate outcomes are being achieved.

4. Keep on top of staff training and communications

Many employees are facing large scale changes to the way they perform their duties in the wake of MiFID II. It’s important that firms think beyond any initial training requirements and have plans in place to monitor compliance, reinforce expectations and deliver refresher training when issues or knowledge gaps are identified.

It’s also important that employees have a clear understanding of the standards and rules that apply to them and are held accountable for their conduct, particularly as the FCA turns its attention to rolling out the Senior Managers & Certification Regime (SM&CR) to the wider industry in the coming months.

5. Explore the wider benefits of the legislation

In the face of such wide-ranging changes, it can be very easy to focus on the changes needed to comply with the regulations and forget to explore the wider benefits those changes could bring to the business and its bottom line.

Take MiFID II’s conversation recording requirements as an example. Having records in a secure and accessible format is key to demonstrating compliance, providing evidence in the event of a complaint and ensuring appropriate oversight of business activity, but the benefits don’t end there.

The data provided by recorded conversations can highlight areas where process efficiencies can be made, provide greater customer insight and can drive staff training and performance management programmes. The management information (MI) from conversation recording can also help firms identify where future risks lie across the business, not just those areas MiFID II impacts.

MiFID II is now in force, but firms shouldn’t relax just yet. In order to maintain compliance and meet regulatory expectations, firms need to be regularly reviewing their arrangements to ensure they continue to meet the appropriate standards and deliver consistent outcomes.

Alarming new research from bed manufacturer Sealy UK, has revealed the nation’s bankers and finance professionals are turning up for work sleep deprived - impacting not only on their productivity and mood, but even their safety. It is now spearheading a major initiative, appealing to bosses to take this often-overlooked issue more seriously.

The awareness campaign is based on data from Sealy’s recent Worldwide Sleep Census, which questioned 5,000 people of a working age from across the UK, revealing a staggering 79% of bankers and finance professionals admitted they could function better at work if they slept better.

This places the sector as the second most sleep-deprived profession in the UK, coming below hospitality (86%), but above construction, retail and transport.

It appears this ongoing sleep deprivation is causing some serious issues in the working week; 65% of bankers regularly lose their temper or have been irritable to a colleague, 30% claim they suffer a lack of productivity, while 19% say they’re often late into work or have time off as a result.

A shocking 1-in-25 even admitted falling asleep whilst at work.

However, perhaps most worrying is the 11% of bankers who have had a recent accident at work – such as a trip or a slip, due to feeling tired.

A call for bosses to put sleep at the top of their agenda

Despite the popularity of ‘wellness’ perks at companies across the UK, from gym memberships to medical insurance and even free healthy snacks, sleep remains something that is often overlooked by employers, and not treated as an important issue. This happens despite the potentially serious impact of staff not achieving adequate rest, as demonstrated in the study.

Neil Robinson, an expert on sleep at Sealy, comments: "Lack of sleep – and the subsequent fallout the next day – can be caused by a wide range of legitimate medical conditions, from stress, to mental health problems or respiratory disease. Even at the less severe end of the spectrum, there’s usually an underlying health issue causing sleeplessness. However, it’s often treated as an incidental issue by bosses, with a ‘pull yourself together’ attitude. This is not helpful for employees, especially when there are some potentially severe consequences of turning up exhausted.

“There are of course occasions when staff are tired as a result of staying up too late or burning the candle at both ends. However, this campaign is about helping bosses make that distinction, as well as encouraging a common-sense approach to effectively managing sleep in the workplace”.

To address this important issue, Sealy is working with a leading HR expert, Kate Russell, of Russell HR Consulting – a firm advising companies of all sizes across the UK when it comes to best-practice HR policy – to produce a ‘common sense’ guide for bosses to better manage sleep deprivation of staff.

(Source: Sealy)