News Briefing - Crowdfunding, SME And Alternative Finance

crowd consulting information posters on a wall

1. UK – FinTech 

More than 1 million consumers have bought crypto assets for the first time over the past year, according to research by the Financial Conduct Authority (FCA)AltFi reports:

“The UK regulator says that in total 2.6m UK consumers have bought crypto assets at some point following a 1.1m increase since the FCA completed a face-to-face survey on the same topic last year. 

Of the 1.9 million that still hold their crypto assets – such as Bitcoin, Ripple or Ether – half have more than £260. 

The FCA’s Interim Executive Director of Strategy and Competition, Sheldon Mills, says the FCA’s data reveals the increasing popularity of crypto assets among the UK consumer population.

“Cryptoassets present risks and opportunities for consumers and we hope these insights will help inform the policy debate in the UK and internationally as the use of these assets continue to grow,” he said.

The FCA has previously warned that crypto assets are highly volatile and risky. Many are not currently regulated in the UK. This means that the transfer, purchase and sale of such tokens currently fall outside its regulatory remit, leaving customers unable to make complaints to the Financial Ombudsman Service or seek protection from the Financial Services Compensation Scheme.”

 

2. UK – FinTech

The FinTech Times runs an opinion piece on the future of challenger banking.

“2020 was always going to be a pivot point for both UK challenger banks, and the FinTech sector as a whole, even before the crisis.

However, few at the start of the year could have predicted just how much global lockdowns would upend our daily lives and, with it, our spending habits.

Much has been made of the drop in use of challenger banks during the Covid-19 crisis. Recent research from Curve, for example, has found that, as the UK entered lockdown, use of challenger banks’ products fell by 90%, compared to just 60% for traditional banks.

 

For all the widespread speculation, this drop is not the product of the inherent undesirability of the challenger offering; rather it reflects a temporary change in spending habits. With consumers trapped indoors, it’s inevitable that challenger tech – often used for a coffee here or a sandwich there – should briefly decline in use. Larger transactions are typically made using account holders’ traditional banks, which store their larger deposits (such as salaries and savings) and will therefore have better overdraft limits.

Additionally, the challenger banks’ USP has been based on the ease of use of their apps and the transactional data that they provide. Lockdown has slowed down the frequency of transactions and therefore the reason for using challenger banks.

Moreover, whilst the card payment data provided by Curve provides a snapshot of the use of a card that is linked to a bank account, it does not provide an accurate snapshot of the use of a bank’s services or the usefulness of the underlying account – both key user advantages that the challenger bank sector maintains over most traditional banks

App usage is a better indicator of the usefulness of a bank’s products but not the effectiveness of its customer services. However, the challenger banks use push notifications to provide the information for which account holders would typically access their online apps, meaning that fewer challenger bank customers will be recorded as opening their apps, despite their shiny new aesthetic. This may go some way in explaining the change in banking habits triggered by lockdown. In short, we’re witnessing a temporary aberration, not the start of a prolonged decline.”

 

3. UK - FinTech

French investment bank Société Générale has revealed that it has acquired challenger bank Shine, an entrepreneur-focused digital bank, according to AltFi.

“Shine, which has amassed over 70,000 in just two years, offers SMEs and self-employed people a fully digital bank account and several other helpful features, such as invoicing, accounting and tips on how to better run their business. 

The fintech will continue to develop independently from Société Générale, with the hope to grow organically with the support of the French bank. 

Société Générale plans to use the challenger to extend its own business banking offering and will offer Shine’s services to its existing business banking clients.”

 

4. UK – AltFi

 

Business Cloud reports:

“Award-winning Joe Averill has launched his own consultancy, Vault 23, to help businesses grow. 

The 29-year-old, who won a string of awards during his three-and-a-half years at Manchester-based property company OBI, is focusing on businesses in the finance, tech and property sectors. 

He’s already helped one client Recoup Capital treble its recurring revenue growth in less than four months and has ambitious growth plans of his own for Vault 23. 

Averill, who is also working with the technology platform Gigable, admitted launching his business during the COVID-19 pandemic was a gamble but he had no regrets. 

“Leaving OBI was the toughest decision I’ve ever had to make in my career so far,” he said. “Will Lewis gave me a big opportunity when I had no real estate experience and, along with Andrew Cowell, was instrumental in my career progression and helping me win a number of awards. 

“However working with entrepreneurs makes you entrepreneurial yourself. My primary role at OBI was to support fast-growth occupiers to deliver their real estate strategy and I identified an opportunity to work with clients and founders to deliver both their route to market and revenue growth strategy. 

“By sitting inside the business I am responsible for both creating the growth strategy and executing it. For example Recoup Capital appointed me as their interim chief revenue officer and have already had a ROI in excess of 900 per cent.” 

Averill said launching his business during the pandemic had presented both challenges and opportunities.”

5. UK – AltFi

UK TechNews runs an opinion piece on “the driving force” behind e-commerce.

“COVID-19 has shaken the world as we know it, and existing ways of working and living have been flipped on their heads. The ‘first wave’ saw the vast majority of the population confined to their homes, and generations were relying on technology to access essential services, communicate with family and friends, and work remotely. 

As a result, we’ve accelerated towards a digital-first world, where technology lies at the heart of society’s infrastructure. This switch to digital has had rippling affects across industries, especially retail.

With the risk of COVID-19 still in the midst, and many non-essential stores shut for the first few months of the pandemic, consumers who had never headed to websites to do their shopping – I call them ‘Generation Zoom’ – suddenly had to rely on the power of global ecommerce. As such, the digital-first economy is booming as ecommerce becomes the new normal for many.

This surge in ecommerce hasn’t come as a surprise. Shifts in consumer demands have been present for a long time, as technology becomes intrinsic to daily life. In fact, last year it was estimated that global ecommerce was worth $5.353bn, and it’s expected to exceed $6.542bn in the next three years.”