Our Weekly Newsletter
Across Instinctif Partners’ Financial Services team, we are always keeping an eye on the key developments taking place across the sector to evaluate their impact on the many businesses we work with. Here we share our picks of the week’s most interesting news, and our expert views.
HMRC delays cause UK start-ups to raise emergency capital
Numerous UK start-ups claim that they were forced to raise emergency funds in 2019 after facing unexpected tax credit delays of up to several months. The delayed tax credits were included as part of an initiative to encourage more research, which reportedly let small and medium-sized enterprises cut 130 per cent of research and development costs from their annual profit. The start-up community is seeing mounting fears that the issue will return in March when many small businesses are set to submit their claims. (From Financial Times, 16 February 2020)
Finance on Instagram
The “Instagram generation” is now getting financial advice from their daily scrolls through the app, from money-saving tactics, to debt-clearance plans. An ‘online finance community’ is slowly developing as the younger generation become more financially aware in a way that distances themselves from traditional personal finance methods (e.g. paying for financial advisors). This development further supports the argument for institutions to consider this channel to reach younger audiences. (From Financial Times, 14 February 2020)
The CII and FCA to invest in the financial futures of women
The Chartered Insurance Institute and the Financial Conduct Authority have agreed that the financial futures of women need to be at the forefront of diversity and inclusion discussions within the financial services industry. Chief executive of CII, Sian Fisher hopes to make progress by compiling disaggregated data to better understand the financial obstacles faced by female clients (i.e. wage gap) and how financial advisers may better cater to them. In addition to disaggregated data, Ms. Fisher says using gender-neutral language in company documents is a good start towards gender inclusivity in the financial sector. (From FT Adviser, 14 February 2020)
Climate change: can the insurance industry afford the rising flood risk?
The global increase in flooding means insurers could generate $48bn of annual premium revenue in the US market alone, according to risk consultancy Milliam. The economic damage worldwide from flooding last year was $82bn, with only $13bn of that insured by consumers. However, as natural catastrophe specialists predict that global warming will increase the frequency of flooding, as seen in the UK over the past fortnight, many are questioning whether insurance companies themselves will be able to keep up with growing claims. (From Financial Times, 20 February 2020)
Pick’n’mix mortgages on the rise
Pick’n’mix mortgages have recently come to the spotlight for offering flexible plans by allowing borrowers to divide their loans based on individual needs, creating new opportunities for homeownership that may not have been accessible to some with the standard 25-year term. Carolyn Thornley-Yates, head of sales at Hinckley & Rugby Building Society, argues that the split loan terms may help first-time buyers by helping parents plan for retirement and support the next generation into homeownership. (From The Times, 15 February 2020)