Financial technology, also known as FinTech, forms a new revolution within the financial sector that aims to use technology in order to improve the industry and make it more efficient. FinTech companies generally comprise of disruptive startups that are challenging the way that things are currently run, attempting to give more back to the customers who use the services. But will they be able to challenge the status-quo and overtake big banks?

How do FinTech companies work?

FinTech companies have been brought about because of the increase in innovation and technology that we are witnessing in the modern world. They use technology as their means of making the financial world easier for the everyday user, making use of the power of smartphones, apps, and the huge level of connectivity that we now have.

Banks, to a degree are FinTech companies, with their own dedicated mobile banking apps, but some of these are typically seen as nothing more than after-thoughts, and regularly pick up negative reviews and complaints.

Other mobile banking apps, such as Revolut, are dedicated apps and have no physical branches or stores, meaning they can focus solely on their financial technology experience. This allows for a streamlined and easy experience that makes for a much better app from giants such as Barclays or Santander.

But they attempt to go further than the other mobile banking apps, such as with £500 free international withdrawals each month and access to the very best exchange rates on the market, allowing them to offer better rates than other established credit cards.

This is alongside other fast-growing FinTech startups which appear to be overtaking big banks such as Transferwise, which allows for hugely cheaper international money transfers than big banks; typically eight times cheaper.

Essentially, the one thing that all of these FinTech startups have in common is that they are attempting to take power away from those who have, until now, been left previously untouched. They are doing similar things that Uber has done to the taxi world, or Airbnb has done to the rental world; making things easier and more cost-effective for the consumer.

But will FinTech be able to overtake the big banks?

There has been a huge distrust in banks since the 2008 crisis, and this will take many, many more years to die down. This has, in part, been the reason for such a large increase in FinTech companies.

There can be no denying that FinTech companies are going to have a profound effect on big banks. The latter is tied down with stringent regulations, top-line growth, and slow economic recovery. This is alongside the fact that FinTech startups will continue to drive prices down and eat away at big bank’s profit margins.

Big banks do still record yearly profits of around $1 trillion, and it is likely that this won’t drop dramatically anytime soon. But with roughly 12,000 FinTech start-ups on the market and counting, big banks will need to adapt or risk falling behind the competition. So yes, if big banks don’t adapt and modernise, it is likely that one day we will see FinTech overtake them.

Can FinTech and big banks work together?

Big banks and FinTech are not two separate industries; they are part of the same thing. We are already beginning to see banks adapt to the new wave of technology, such as Apple Pay being built on top of existing banking systems.

Big banks know that they are having to recover lost ground and build trust back up in their organisations. The fact that Apple Pay is built on their systems shows that they have a huge interior engine that drives much of the financial industry. However, it is the exterior where they are lacking, the actual customer-facing side, that FinTech is nailing.

The banking and finance industry have become dinosaurs amongst its evolutionised FinTech counterparts and they are struggling to catch up. However, many have said that they are willing to help and fund FinTech if it can be integrated in their businesses.

Big banks have the dominance, the power, the money, and the establishment to adapt and change to the ever-developing market around it. If they do this, it’s likely that they will maintain their ultimate dominance, albeit with some loss to FinTech startups. Failure to do this, however, will let us witness FinTech overtaking big banks.

Gone are the days where we need to queue up in a physical bank to conduct all of our financial needs; we can now do everything we need from handy smartphone apps. However, some businesses still treat their application equivalents as afterthoughts, without putting enough focus and attention to it. Below we have reviewed the various smartphone applications for the main UK banks.

Lloyds

A review of mobile apps was recently carried out by Forrester, and Lloyds secured the top spot with a score of 77 out of 100. The Lloyds business bank app has all of the most basic features, such as money transfers, but also places a good focus on more complex features such as financial product comparisons. All-in-all, it offers a streamlined and easy experience.

The Lloyds business bank app scores almost perfect 5/5’s on the iTunes Store and Google Play, but common complaints include it being slow and buggy.

Barclays

The Barclays banking app is also one of the best on the market and secured second place in the review. It provides an effortless and seamless experience that makes mobile banking easy. It supports both business and personal accounts and is slick and quick to load. It’s easy to send payments and make transfers, and each account is easily separated and accessible, making it an almost perfect design.

There have been some complaints with newer versions where some features have been dropped. It no longer displays a running balance on your account activity, making it harder to track a balance between transactions. These are minor issues, but they do take away from the overall experience.

NatWest

The NatWest app came third in the review, although Forrester noted that it is the best app on the market for its range of account management features. One handy feature is that it allows for the withdrawal of cash from an ATM without needing a card, by providing the user with a one-time use code.

Its service capabilities and customer enrolment features are its downfall, and are somewhat limited compared to the account management features. The app only scores 2.5/5 stars on the iTunes store, with issues of complexity or lag being commonly cited as letting the overall experience of the app down.

Santander

The Santander business bank app took fourth place, with many of the same features as the previous banking apps. Santander is attempting to be innovative, by claiming that they will be the first ones to offer international payments and wants to incorporate a virtual assistant similar to Apple’s Siri to help provide advice on spending habits.

However, the design of the Santander app lets it down. It is clunky and quite slow for the user, and so when in comparison to the Lloyd’s or Barclays’ app it doesn’t really compare.

HSBC

The HSBC business bank app ranked fifth in the Forrester review, although it was given credit for being smooth and simple when it came to enrolling and logging in. It also helps by offering useful budgeting information for those that are looking for a loan.

However, it has limited service and account management features. It doesn’t fare too well on the iTunes store, with only one star. Users complain about its poor design and lack of functionality when rating it.

Banking apps as an experience

There are, of course, other banks in the UK, but the ones presented above offer the top five mobile banking experiences. The other banks’ apps, unfortunately, didn’t offer the customer enough in the way of features and seem to be treated more as afterthoughts. The Lloyd’s and Barclays’ apps came top of the pile, giving their customers a robust enough experience so that they won’t need to use browser banking again!

Are you looking to kick start your business, gain the funding that you desperately need to expand (or simply survive), and inject a dramatic new purpose into your career – and your life in general? Accelerator programs are the answer that you may be looking for. Aimed at start- up entrepreneurs who have fantastic ideas but who may be lacking in funds and/ or experience, firms offering Acceleration Programs are dramatically increasing in number year on year.

Barclays is one of an increasingly larger number of corporate giants and multinational firms who are launching their own Accelerator programs, partnered with Techstars, a well known leader in the industry.

Can an Accelerator Program help you and your Fintech business survive and thrive? Read ahead to learn more about these groundbreaking firms and find out if this is a viable and attractive option for you and your business.

What is an Accelerator Program?

Accelerator Programs are taking the business and financial world by storm, with countless organisations springing up and promising a huge, rapid boost for your business. Originally geared more towards start up culture and young entrepreneurs, Accelerator firms can offer their clients an opportunity to network, learn new skills, access to new customers and markets, and most importantly – they can help them to acquire the funding that they need to take their idea to the next level.

In December of 2014, The Telegraph assessed that there were 36 accelerator and/ or incubator programs across the UK, with the vast majority (over two thirds) based in London. Most are located in the so-called ‘Silicon Roundabout’ at Old Street station, home to over 1500 start ups and tech firms. It is important to remember that this number pales in comparison to the Accelerator programs in the United States, with numbers in the thousands (here is an interesting link to the top 20 American Accelerator Programs in 2015). Approximately 40 % of these programs are private enterprises, and over 25 % are run by academic institutions.

The most successful and famous US Accelerator firm is Y Combinator. This illustrious company has invested in more than 1000 start-ups, and their most successful past clients are Dropbox and Airbnb, companies that are worth more than 30 billion US dollars. This is clearly something worth looking into!

What are the Benefits of An Accelerator Program?

These firms can help young companies in their early stages of development to grow, flourish and learn. They often provide seed money and leadership, and research has shown that start-ups that qualify for and secure a place on an accelerator program are more likely to do well in the long term, with higher rates of success than businesses who do not engage in such a program. Money, success, investment possibilities, mentorship opportunities and new skills – these programs have myriad benefits; if you are small business owner or a young start up entrepreneur, it is worth looking into any accelerator programs you might qualify for.

From Start-Ups to FinTech?

At this point you might be wondering what all of these accelerator programs aimed at tech firms and young, kooky app companies has to do with you and the field of Financial Technologies. The answer may surprise you – more often, accelerator companies are branching out beyond the industries that they traditionally supported and taking an interest in other sectors. Restaurants, healthcare, fashion, and banking are all experiencing a surge in corporate- run accelerators, and Microsoft, Telefonica and Barclays are all offering similar programs.

Barclays Accelerator Program for Fintechs

Banking giant Barclays has entered the Accelerator ring with their new program, aimed at Fintechs (Financial technicians). While this program is officially linked with Barclays, it is actually offered by Techstars, “a global eco system that helps entrepreneurs build great businesses.” This is quite an advantageous partnership, as Techstars has years of experience in the industry, while Barclays has heaps of capital and a global reputation for banking excellence over the past 300 years across over fifty countries.

The Barclays Accelerator (Powered by Techstars) is a three month program billed as an ‘intensive start-up accelerator,’ that focuses on “financial technology innovation and disruptive solutions.” This program is currently being offered in London, New York, Capetown and Tel Aviv (although applications are currently closed), with plans to expand further in the near future. They allow between six and ten teams to participate at any given time, and this includes the potential for up to 120,000 US dollars per team.

Now that the program has been operating and thriving for over two years, success stories are starting to emerge from early Barclays Accelerator Alumni. From Squirrel, an app that helps lower income individuals save money and make ends meet, to Gust, a wristband/ app that helps people avoid long queues by using Bluetooth technology and information from past trends – these are interesting and successful companies that have benefited greatly from their affiliation with Barclay’s Fintech.

The Future of Accelerator Programs

It is safe to say that this trend is not going anywhere any time soon – Accelerator programs have been so successful and so ‘buzzed about’ in the media that it is certain that they will continue to expand. We can expect to see this model move from hardware and Fintech to ever more diverse industries. Experts are also predicting that more and more of the investment capital will come from crowdfunding sources, a way to spread the risk across a vast pool of people and create loyal users before the product or app is even completed.

Is one of Barclays Accelerator Program for Fintechs of interest to you? Keep an eye on their site to determine when new submissions will be accepted and start planning your application now.

Formations Direct surveyed their business customers about welfare reforms and 78% of them said that cutting benefits is an important element of the changes. Does this mean that the self-employed are fed up of seeing themselves working hard and taking risks whilst looking at their “neighbours” sitting at home and cashing in?

Presumably people are compassionate and don’t begrudge the sick and infirm a degree of help so the question is where to strike the balance. On the one hand if businesses are “burdened” by disability legislation, surely the disabled need to be working rather than receiving benefits, or perhaps receiving less benefits, but the counter-argument is that we could be acting cruelly by forcing some people into work when they are simply not up to it, which benefits neither them nor SMEs.

From my perspective there should be no sacred cows in welfare reform. Just because something is cherished dearly doesn’t mean we can’t examine it closely and see if it can be improved upon. Perhaps we need to rename the changes as “welfare innovation” and offer a hefty cash prize to the best idea.

Business insurance can be a struggle, especially for start-ups, with an array of covers available. Cutting corners and getting it wrong can prove costly, putting your business and even your personal assets at risk. The right cover will provide comfort – allowing you to focus on the business itself. Make it a priority after you’ve completed your company formation.

Learn your legal and contractual responsibilities

Ask yourself – are there any insurance requirements placed upon me? If you’re not sure ask your broker for guidance, they’re there to help.

Want to put a sign outside your new shop? You’ll likely need public liability. Working with a City bank? You’ll probably need professional indemnity. Employing staff? You’ll most definitely need employer’s liability (read more here).

From industry to occupation the cover you’ll require will change, so look at your business long and hard, conduct your research and make sure know what insurance you’ll need.

Ensure you’re covering enough

Many insurers will apply penalties if you ‘under insure’ items so it’s important to get sufficient cover in place. For example, say your equipment is worth £10,000, but you choose to only cover £5,000 (50%) as you doubt you’ll lose it all and you want to cut costs on the policy. A claim of £4,000 would be reduced to £2,000 (50%) before any excess deduction.

Always look at the bigger picture. A few pounds shaved off your policy cost could set you back hundreds, even thousands later down the line.

Seek a reputable insurer

Insurers are bound by several regulated duties, but the way they choose to carry these out may vary – so choose wisely. Researching your insurer is key here and with the web it’s easier than ever. Feefo is a good source of this research, as is consumer championWhich?. Cast an eye over sites like these and you’ll be better placed to make an informed decision.

Look for endorsements and exclusions

So, you’re on your way to building a policy with a reputable insurer, set at the right levels and fulfilling all of your requirements – what else should you look out for?

Insurers will often place certain conditions on a policy called endorsements and exclusions. You’ll usually find these highlighted or listed on your schedule and they can alter things that you might expect to be covered normally. For instance; you may find a flood exclusion means the stock cover you took out won’t apply if it gets damaged in a flood.

Bear in mind that as well as exclusions, other conditions may exist on the policy. Perhaps you’re required to carry out regular training, stock checks, audits and the like. You will only know by asking or carefully checking through your policy.

Ask where the added value is

Finally, you’ve found two policies that cover everything you need, both from reputable insurers and at prices that are almost the same. How do you choose between them?

A good way would be to search for the added value in the policies. Many insurers will include extras such as –

• Legal advice lines for tax and HR enquiries

• Seasonal stock increases

• Personal accident cover (in case you get injured and can’t work)

• Goods in transit cover

In short, take your time when choosing a policy and ask as many questions as possible. Although insuring your business can seem like a nuisance and something you want to get over and done with quickly, it’s important to invest ample time in picking that first policy – it’ll potentially provide greater security and peace of mind for years to come.To get your quote click here

DIRECTORS BLOG

One of the knottiest issues of running a small limited company is the understanding of directorships. People often fail to appreciate that a director is just that. He or she is directing everything that goes on in a limited company, either on their own or as part of a team. The buck stops firmly with the company directors in all circumstances, even if they have delegated day to day matters to trusted managers.

I remember many years back when attempting to register my intention to wed, I went to the council and the stroppy clerk asked my soon-to-be wife what her father’s occupation was. Upon receiving the answer “company director”, she retorted pithily “that is not an occupation – it is a status”. Silly old battle-axe, but she was correct – it is a status and it carries serious responsibilties, usually those of health and safety being the ones that make the headlines when it all goes pear shaped.

Now, to confuse people more, they think that a non-executive director is a way of being a director without legal responsibility. This is incorrect as the law only does not discriminate between types of directors. In a large company it may be easier to mitigate the situation as there are clearly a lot more decision makers and everything is recorded and chronicled even down the teabags used, but in a small owner managed limited company it will be much harder to run away from it all when the balloon goes up.

So, the parting lesson is this – directorship is what is known as “strict liability” – you are liable for anything that may go wrong with the company.

So before you do your mate a favour bear it in mind!