UK FinTech Sector Gets Ready For ‘New Normal’ Post-Covid World

Today, we bring you a couple of news items from the trade press. To us, they indicate high levels of activity and preparation for vigorous business activity in a world that re-emerges into a new version of normality, now we can look forward to control and perhaps even the extinction of Covid-19.

James Barker, formerly commercial director of EMEA at Mambu, is taking on the newly created role of chief commercial officer at Bud.

The hire is reportedly in preparation for Bud scaling up its commercial operations in 2021, with Barker supporting the teams which look after the fintech’s customers.

“One of the holes that a lot of technology providers fall into is they focus very inwardly on the technology,” Barker told AltFi when asked about his decision to join Bud.

“I think what Ed and George have is an appreciation that it’s all about the customer experience and trying to find new ways to use this transactional data and these new capabilities to materially step forward.”

“That’s very appealing to me.”

So far Bud has won a handful of key client wins, including a global deal with HSBC and its challenger brand First Direct, as well as Goldman Sachs and Sabadell.

Earlier this year the fintech also launched open banking payments, with Blockchain.com as its launch customer for these payments which are more simple and faster to initiate than traditional bank transfers.

In a latest development, UK challenger bank Monzo has quietly secured £60 million in funding from new investors including Deliveroo and Stripe investor Novator, Kaiser, and TED Global, as well as existing investor Goodwater.

Historical Performance And IFISA Process Guide

  • Money&Co. lenders have achieved an average return of more than 8 per cent gross (before we deduct our one per cent fee). 

That figure is the result of over £20 million of loans facilitated on the site, as we bring individuals looking for a good return on capital together with carefully vetted small companies seeking funds for growth. Bear in mind that lenders’ capital is at risk. Read warnings on site before committing capital.

  • Money&Co. has been lending for over 5 years and has only had two bad debts so far, representing a bad debt rate of 0.03 per cent per annum.

All loans on site are eligible to be held in a Money&Co. Innovative Finance Individual Savings Account (IFISA), up to the annual ISA limit of £20,000. Such loans offer lenders tax-free income. Our offering is an Innovative Finance ISA (IFISA) that can hold the peer-to-peer (P2P) business loans that Money&Co. facilitates. For the purposes of this article, the terms ISA and IFISA are interchangeable.

So here’s our guide to the process:

  • Step 1: Register as a lender. Go to the login page, and go through the process that the law requires us to effect. This means we have to do basic checks on you to comply with money-laundering and other security requirements.
  • Step 2: Put money into your account. This is best done by electronic transfer. We can also process paper cheques drawn in favour of Denmark Square Limited, the parent company of Money&Co.
  • Step 3: Buy loans in the loan market. Once you’ve put cash in your account it will sit there – and it won’t earn interest until you’ve bought a piece of a loan. It’s this final step that requires lenders and IFISA investors to be pro-active. Just choose some loans – all loans on the Money&Co. site can be held in an IFISA – and your money will start earning tax-free interest.

The ISA allowance for 2019/20 is unchanged from last tax year at £20,000, allowing a married couple to put £40,000 into a tax-free environment. Over three years, an investment of this scale in two Money&Co. Innovative Finance ISAs would generate £8,400 of income completely free of tax. We’re assuming a 7 per cent return, net of charges and free of tax here.

Once you have made your initial commitment, you might then consider diversifying – buying a spread of loans. To do this, you can go into the “loans for sale” market. All loans bought in this market also qualify for IFISA tax benefits.

Risk: Security, Access, Yield

Do consider not just the return, but the security and the ease of access to your investment. We write regularly about these three key factors. Here’s one of several earlier articles on security, access and yield.


Tags: Altfi, covid-19, UKTN

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Disclaimer: Money&Co.™ is the trading name of Denmark Square Limited, Company Number 08561817, registered in England & Wales, authorised and regulated by the Financial Conduct Authority (FCA). The company is identified on the Financial Services Register under Reference Number 727325. The registered office is 58 Glentham Road, Barnes, London, SW13 9JJ where the register of Directors may be inspected. Denmark Square Limited (ISA manager reference number Z1932) manages the Money&Co. Innovative Finance ISA.