Tag: finance

Which? urges clarity on financial help for bank customers

Which? is calling on the financial regulator to urgently provide greater clarity on temporary measures to help people struggling financially because of coronavirus, as new research reveals the huge toll the outbreak is expected to take on people’s finances.

A survey by the consumer champion carried out between 20-22 March, just before the government asked people to stay at home to stop the spread of coronavirus, highlights that significant numbers of people are expecting to struggle with their finances over the next year.

With the Financial Conduct Authority (FCA) set to introduce temporary measures tomorrow designed to help consumers falling into financial difficulty as a result of the crisis, Which? can reveal people of all levels of working status are now expecting their household finances to worsen over the next 12 months, with those who work part time reporting the highest level of concern.

Taking the proportion of people expecting their financial situation to get better and subtracting the proportion who expects it to get worse, confidence among part-time workers was at -56 percentage points. The figure stands at -36 for those in full time work.

Of those that are retired, confidence in the future of their household finances stood at -49 for those on a state pension only and -45 for those with a private pension.

The research also shows that consumer confidence in the economy has plummeted. When asked whether the economy would be better or worse in 12 months’ time, confidence fell from -17 in February to -78 in March.

Worryingly, the financial impact of coronavirus follows a period in which large numbers of people were already reporting having cut back on spending, with 39 per cent of consumers in 2019 reporting that they reduced spending on essential items or took money from savings to cover their spending.

This indicates that a significant number of people may have already been close to the point of relying on credit to help manage their personal finances, and the impact of coronavirus could have pushed them to the point where they now need to depend on existing credit cards, loans or overdrafts.

Measures proposed by the FCA last week, due to come into force on Thursday, are designed to provide a temporary solution for consumers who until now have been financially stable. These include a temporary payment freeze on loans and credit cards as well as zero interest on existing overdrafts up to £500, with both put in place for three months.

However, while Which? is generally supportive of the plans, reassurance is needed that the measures can be consistently applied for customers across all banks, and that customers who take up these options will be fully aware of any longer term implications of using them.

This requires the FCA to be as explicit as possible about precisely when the payment holiday period starts – whether it is from the proposed launch date of 9 April, or from the moment the consumer requests support at any point during those three months.

There also needs to be a clear, industry-wide exit strategy for the temporary measures, which must ensure that customers do not end up in unnecessary financial hardship.

There is particular concern about how consumers will be moved off of their £500 interest free overdrafts after three months.

The consumer champion says it is vital that banks do not immediately place consumers back to their original arranged overdraft and rates at the end of any holiday period, and the FCA should consider  “easing off” interest-free overdraft arrangements in a way that does not affect credit scores.

The consumer champion believes that greater transparency will make it easier for people to access services online and make it clear that only those in the most urgent need should seek to directly contact their financial institutions. This should reduce the burden on call centres, providing a greater chance of consumers getting the help they need in good time.

Gareth Shaw, Head of Money at Which?, said: “The impact of the coronavirus outbreak is going to cause a sharp shock to huge numbers of people across the country, and many who were previously in good financial health will now require help from their banks to see them through the coming months.

“While the FCA has taken positive steps to provide assistance, there needs to be urgent clarity so that banks can apply this support consistently for everybody who is eligible, and customers can decide whether these measures represent the best option available to them.”

Hints and tips on managing money if you’ve been furloughed

The Government’s furlough scheme allows for 80% of salary, up to £2,500, to be reclaimed by the employer per month. 

Many companies are now taking advantage of this scheme in order to protect cash and ensure the longevity of the business when social distancing restrictions can be lifted later in the year, say tax and advisory firm Blick Rothenberg.

David Hough a partner at the first said: “For many employees this is a far better outcome than losing their job altogether, maintaining a slightly reduced income and in all likelihood being able to return to the same place of work later.

“However, many families will still feel the impact of this over the next few months whether it be from being placed on furlough, reduced income from the Government’s Self-Employed Income Support Scheme or loss of income altogether.”

He added: “There are some things that many people can do to help manage over the next few months.”

Remove your salary sacrifice deductions

Plenty of employees contribute into a pension pot through salary sacrifice deductions. It is important to save for your retirement, and the Government encourages this by making such deductions tax free, however removing or reducing these payments will increase your take home pay in the next few months. You can top up your pension later in the year when you have more certainty over your income.

Review your direct debits

Review your direct debits with your family to check you aren’t paying for things that you don’t really need. Gym memberships cannot be used at the moment and should be cancelled or deferred. Families should make sure they are not paying for multiple streaming services, or sports packages for which there is no live action. Companies like Spotify offer family memberships which will save money if a household has more than one account holder.

Defer some payments

Payment deferrals, including mortgage deferrals and other loan holidays, should be agreed with the other party but this approach should mean that you can continue pay for crucial items whilst catching up on other payments later in the year.

Many of us pay for our utilities on a monthly basis which is helpful because it means we can predict our monthly spend. However, you might have built up a credit for gas and electric or contributing more than you will actually use in the warmer months coming up. There is an opportunity to schedule these costs differently to help manage through this more challenging time.

Prepare a six-month budget

If you feel that your available cash is going to be less than normal for the next few months you should aim to make a six-month plan and budget your income and expenses over that period.

If restrictions are lifted in the early summer many people will gradually see their incomes return to a normalised level in months four to six.

You will find it helpful to see that your payments can be managed over a longer period and it will also highlight if there are items you are spending money on that you may need to cut back on at early stage.

Rock Star … or Rock Bottom?

“We have to take a win-at-all-costs attitude to ensure British businesses survive. This is no time for unworkable criteria and red tape – the Government needs to realise this now before it’s too late.”

CHANCELLOR Rishi Sunak was hailed a ‘rock star’ when he announced a range of measures to support British businesses facing a financial crisis due to the coronavirus outbreak.

But one entrepreneur says unless the Chancellor cuts the red tape and changes the criteria preventing firms from accessing vital funding – bosses will soon brand him ‘rock bottom’.

“The Chancellor has made it clear that his intention is to support the British economy and protect British business. The only way to do that in the current COVID-19 situation is to make sure the money is ready and easy to access,” said entrepreneur Eddie Black.

“The headlines about the Government’s announcement about helping businesses via the Coronavirus Business Interruption Loan Scheme (CBILS) are fantastic and the Chancellor looks like a rock star. The reality is very different to the headlines.”

Eddie (above), managing director of ECO, says that having read the terms of the loan, and having had in-depth conversations with a range of lenders on the panel, there’s some serious failings in the arrangements which could send businesses to the wall.

The loans are:

  • facilitated via the Enterprise Finance Guarantee (EFG) scheme and only protects the banks up to 80 per cent
  • subject to the usual credit and due diligence (this is estimated to be a four to six-week process)
  • subject to the ability to service the loan – businesses need to provide evidence of future forecasts and business performance predictions

Eddie says this has knock-on effects for the banks: “Originally the banks were going to get 100 per cent guarantees and now it’s only 80 per cent. 

“If there are defaults it will be down to the banks to pursue the debtor and take assets.

“The EFG Scheme might not be a favoured route for them because it means the British Business Bank can say that any inability to pay was down to the lender’s poor due diligence.”

In terms of eligibility criteria for the British Business Bank scheme, an SME must:

  • be UK-based in its business activity, with annual turnover of no more than £45m
  • have a borrowing proposal which, were it not for the current pandemic, would be considered viable by the lender, and for which the lender believes the provision of finance will enable the business to trade out of any short-to-medium term difficulty.

It’s this reliance on future forecasts and business performance projections which Eddie says is such a contradiction.

He went on:  “The British Business Bank criteria states that a company needs to be viable now. Businesses have had all future, or current, opportunities or contracts suspended, and/or, in worst case scenarios, cancelled, without knowing what comes next. 

“Businesses don’t know if that opportunity or contract will be there in the future. Will the client even exist?

“The serviceability and criteria elements are a complete contradiction in terms. No-one knows what the future holds. In many ways, it’s the survival of the fittest.

“There is a risk that businesses will default – that is why it has been described as a war chest.

“The best of British businesses will topple like dominoes if the Government don’t protect the banks. The banks should not be held accountable for lending money that they would not have been asked to lend if it were not for COVID-19.

“If the Chancellor really wants to back British business he needs to back the banks and put the liability on them to ensure that it gets this help into the economy.

“This is a sink or swim scenario and millions of jobs – and the livelihoods of families – are on the line.

“There may be a concern from the Government that businesses will flaunt the rules if these serviceability factors and criteria are not in place, and that might be holding them back on ensuring that this help is available immediately and is easily accessible.

“But businesses which flaunt the rules can be pursued at a later date. Most businesses are not geared up for failure and are in it for the long haul.

“The help is needed now. The money has been pledged and, even if there is a risk of some of it going down the drain, it is better than not getting it into the economy at all.

“We have to take a win-at-all-costs attitude to ensure British businesses survive. This is no time for unworkable criteria and red tape – the Government needs to realise this now before it’s too late.”

ECO has bases at Annan and Creca in Dumfries and Galloway, and in the North-West of England and works all over the UK. It employs 55 people which is due to increase to 80 when it opens its new HQ in the summer.

 

Help for the self-employed … but not until June

Chancellor Rishi Sunak made his long-awaited statement on support for the UK’s five million self-employed workers yesterday. That support will not kick in until June at the earliest, however, and does not cover those workers who have been self-employed for less than three years.

This is what he said:

Good afternoon.

Today I can announce the next step in the economic fight against the Coronavirus pandemic, with new support for the self-employed.

Our step-by-step action plan is aiming to slow the spread of Coronavirus so fewer people need hospital treatment at any one time, protecting the NHS’s ability to cope.

At every point, we have followed expert advice to be controlled in our actions – taking the right measures at the right times.

We are taking unprecedented action to increase NHS capacity by increasing the numbers of beds, key staff and life-saving equipment on the front-line to give people the care they need.

That is why it is absolutely critical that people follow our instructions to stay at home, so we can protect our NHS and save lives.

Our action plan to beat the pandemic is the right thing to do – but we know people are worrying about their jobs and their incomes.

Working closely with businesses and trade unions, we have put together a coherent, coordinated and comprehensive economic plan – a plan which is already starting to make a difference:

  • big employers like Brewdog, Timpsons and Pret have already said that our Coronavirus Jobs Retention Scheme means they can furlough thousands of staff, rather than laying them off. And we are publishing this evening detailed guidance on how the scheme will operate so that other businesses can take advantage, too
  • small businesses are already benefiting from Coronavirus Business Interruption Loans of up to £5 million, which are interest free for 12 months – with 30,000 enquiries in just four days
  • local authorities are already informing more than 700,000 retail, hospitality and leisure businesses that they will pay no business rates this year
  • and the new hardship grants scheme, providing cash grants of up to £25,000 for the smallest businesses, is now up and running

So if any business is struggling, and worrying they may need to lose staff, I would urge you to log on to businesssupport.gov.uk, and look very carefully at what support is available before deciding to lay people off.

I’m proud of what we’ve done so far, but I know that many self-employed people are deeply anxious about the support available for them.

Musicians and sound engineers; plumbers and electricians; taxi drivers and driving instructors; hairdressers and childminders and many others, through no fault of their own, risk losing their livelihoods.

To you, I say this: You have not been forgotten. We will not let you behind. We are all in this together.

So, to support those who work for themselves, today I am announcing a new Self-Employed Income Support Scheme.

The government will pay self-employed people, who have been adversely affected by the Coronavirus, a taxable grant worth 80% of their average monthly profits over the last three years, up to £2,500 a month.

This scheme will be open for at least three months – and I will extend it for longer if necessary.

You’ll be able to claim these grants and continue to do business.

And we’re covering the same amount of income for a self-employed person as we are for furloughed employees, who also receive a grant worth 80%.

That’s unlike almost any other country and makes our scheme one of the most generous in the world.

Providing such unprecedented support for self-employed people has been difficult to do in practice.

And the self-employed are a diverse population, with some people earning significant profits.

So I’ve taken steps to make this scheme deliverable, and fair:

  • to make sure that the scheme provides targeted support for those most in need, it will be open to anyone with income up to £50,000.
  • to make sure only the genuinely self-employed benefit, it will be available to people who make the majority of their income from self-employment
  • and to minimise fraud, only those who are already in self-employment, who have a tax return for 2019, will be able to apply

95% of people who are majority self-employed will benefit from this scheme.

HMRC are working on this urgently and expect people to be able to access the scheme no later than the beginning of June.

If you’re eligible, HMRC will contact you directly, ask you to fill out a simple online form, then pay the grant straight into your bank account.

And to make sure no one who needs it misses out on support, we have decided to allow anyone who missed the filing deadline in January, four weeks from today to submit their tax return.

But I know many self-employed people are struggling right now, so we’ve made sure that support is available.

Self-employed people can access the business interruption loans.

Self-assessment income tax payments, that were due in July, can be deferred to the end of January next year.

And we’ve also changed the welfare system so that self-employed people can now access Universal Credit in full.

A self-employed person with a non-working partner and two children, living in the social rented sector, can receive welfare support of up to £1,800 per month.

The scheme I have announced today is fair.

It is targeted at those who need it the most.

Crucially, it is deliverable.

And it provides an unprecedented level of support for self-employed people.

As we’ve developed the scheme, I’m grateful for the conversations I’ve had with the Federation of Small Businesses, the association of Independent Professionals and the Self-Employed, and a range of trade unions, including the Trades Union Congress.

But I must be honest and point out that in devising this scheme – in response to many calls for support – it is now much harder to justify the inconsistent contributions between people of different employment statuses.

If we all want to benefit equally from state support, we must all pay in equally in future.

These last ten days have shaken our country and economy as never before.

In the last two weeks we have put aside ideology and orthodoxy to mobilise the full power and resources of the British state.

We have done so in pursuit of a single goal: to protect people’s health and economic security, by supporting public services like our NHS, backing business, and protecting people’s jobs and incomes.

What we have done will, I believe, stand as one of the most significant economic interventions at any point in the history of the British state, and by any government, anywhere in the world. We have:

  • pledged that whatever resources the NHS needs, it will get
  • promised to pay 80% of the wages of furloughed workers for three months up to £2,500
  • deferred more than £30 billion of tax payments until the end of the year
  • agreed nearly 17,000 Time to Pay arrangements for businesses and individuals
  • made available £330 billion of loans and guarantees
  • introduced cash grants of up to £25,000 for small business properties
  • covered the cost of statutory sick pay for small businesses for up to two weeks
  • lifted the incomes of over four million households with a nearly £7 billion boost to the welfare system
  • agreed three-month mortgage holidays with lenders and nearly £1 billion more support for renters through the Local Housing Allowance
  • and today we’ve announced one of the most generous self-employed support schemes in the world

Despite these extraordinary steps, there will be challenging times ahead. We will not be able to protect every single job or save every single business.

But I am confident that the measures we have put in place will support millions of people, businesses and self-employed people to get through this, get through it together, and emerge on the other side both stronger and more united.

Thank you.

The Federation of Small Businesses (FSB) – who spearheaded calls for additional help for those that work for themselves – warmly welcomed the proposals.

Andrew McRae, FSB’s Scotland policy chair, said: “Thousands of people who work for themselves in Scotland will now breathe a sigh of relief. This scheme will provide lifeline cash to self-employed people, with help targeted at those on low and moderate incomes.

“We need to vanquish the myth that those that work for themselves are universally wealthy. People like the local handyman, cleaner and fitness coach will benefit from this support.

“Like many of these government interventions, it will take a number of weeks for this programme to deliver. Therefore, those who qualify should try their banks for interim finance if required, while doing what they can to manage their outgoings. This will be much easier said than done, but with help on its way many of the self-employed will rest a little easier.”

Official figures show that there are 320,000+ self-employed people in Scotland.

Andrew McRae said: “Throughout this crisis, we’ve found Ministers in Edinburgh and London sympathetic and approachable. These governments deserve credit for delivering support to business who face difficult circumstances that are neither under their control nor their fault.”

TUC General Secretary Frances O’Grady said: “With so many of the self-employed facing a collapse in their earnings the Chancellor is right to act.

“This is a welcome step forward for self-employed and freelance workers across the economy, from construction to the creative industries.

“It’s vital that support reaches workers as soon as possible. Many are already dealing with severe hardship.

“Unions look forward to being consulted on how this scheme is rolled out.”

New Mortgage Information Support Service launched

New Mortgage Information Support Service to ease financial worries of local people amid COVID-19 outbreak

Mortgage Advice Bureau in Edinburgh has launched a dedicated Mortgage Information Support Service to help homeowners who are worried about their finances as a result of the Coronavirus (COVID-19) outbreak.

The free support service, which is available to homeowners in Edinburgh, has been set up to answer any queries or worries people may have about paying their mortgage, and to guide them back to financial security.

To speak to a qualified mortgage adviser via the support service, homeowners should call 0800 652 6649.  Mortgage Advice Bureau in Edinburgh has also created an online resource of FAQs on the topic. This will be updated daily as more queries are raised. This resource can be found here.

In an ever-changing economic climate, the UK government is responding daily with new measures to minimise the impact of the Coronavirus, not only on our health, but our finances too. This includes access to a mortgage payment holiday of up-to three months for those worst hit financially by the virus.

However, this may not be homeowners’ only worry regarding monthly finances and with the new Mortgage Information Support Service, Mortgage Advice Bureau is answering people’s most common questions around managing their household finances to help them cope.

Dylan Kelly, head of marketing at Mortgage Advice Bureau Regional Network Partner – Scotland, explains further: “We are living in unprecedented times and some homeowners are rightly worried about their finances.

“With a mortgage typically being a homeowner’s largest outgoing, monthly mortgage payments are naturally going to be homeowners’ biggest concern. We’ve set up the Mortgage Information Support Service to help people through this challenging period and to offer advice to those who need it most.

“The helpline is managed by fully qualified mortgage advisers who can provide guidance about what to do if repaying a mortgage is a worry during the Coronavirus outbreak. As the situation changes in the UK and across the globe, it’s difficult for people to foresee how their monthly income will be affected, particularly for homeowners on short-term, temporary or zero-hours contracts.

“The government is doing its best to help people during these difficult times and we certainly take financial well-being very seriously, so we are also doing our upmost to support people. We hope that the helpline will allow homeowners to talk openly and get them back on track with their finances.”

For more information or to speak to a qualified mortgage adviser via the support service, call 0800 652 6649.

You can also find out more information about the Mortgage Information Support Service or view the FAQs here. 

Chancellor to announce support for self-employed

The TUC has called on the government to provide urgent aid to Britain’s five million self-employed workers. The government has been accused of dithering, but Chancellor Rishi Sunak is now expected to make an announcement later today.

A report from the union body published on 23 March warns the current measures in place for self-employed workers are “inadequate” with many facing severe hardship over the coming months.

Hundreds of thousands of self-employed workers have tried to apply for Universal Credit but have experienced huge problems when trying to accessing the system, leaving them with no income.

The TUC report calls on ministers to extend the wage subsidy scheme announced on 20 March to the self-employed. The TUC said this could be done through providing the self-employed with a guarantee of at least 80 per cent of their incomes based on their last three years of self-assessment tax returns.

It says this could be paid directly to the self-employed as a tax rebate. The call was repeated by a succession of unions representing gig workers, musicians, actors, journalists and others in insecure employment.

The TUC report highlights the example of Norway where the government is providing grants covering 80 per cent of self-employed workers’ earnings. In Belgium an income replacement scheme has been set up for the self-employed.

TUC general secretary Frances O’Grady said: “The government took a big and important step last week with wage subsidies for employed workers. But millions of self-employed workers – from the creative industries to construction – are still facing a collapse in their earnings.

“Many won’t be able to meet their basic living costs without further support. Ministers must urgently beef up support for the self-employed.”

She added: “Large-scale wage subsidies are the best way to boost household finances, keep businesses running and help our economy bounce back after this crisis. All workers – both employed and self-employed – should have their wages protected.”

On 23 March, the prime minister announced people may only leave home to exercise once a day, should travel to and from work only when it is “absolutely necessary”, and should shop for just essential items and to fulfil any medical or care needs.

The Chancellor is expected to make an announcement on support for the UK’s five million self-employed workers later today.

£1 billion Business Support Fund opens

Grants to help businesses with COVID-19 impact

Businesses can now apply for grants to help them deal with the impact of the coronavirus (COVID-19) outbreak.

The one-off grants are designed to help protect jobs, prevent business closures and promote economic recovery, and more than 90,000 ratepayers across Scotland will be able to benefit.

The grant support is additional to separate tax relief measures and is part of a package of measures worth £2.2 billion.

Small businesses in receipt of the small business bonus scheme or rural relief, as well as hospitality, leisure and retail business can benefit.

Two types of grant are now available to ratepayers:

• a one-off £10,000 grant to ratepayers of small businesses

• a one-off grant of £25,000 available to retail, hospitality and leisure business ratepayers with a rateable value between £18,001 and £50,999

The list is not exhaustive and if businesses think they may be eligible for one of these grants, they should contact their local authority, which are administering the scheme on behalf of the Scottish Government.

Cabinet Secretary for Finance Kate Forbes said: “While our primary concern is for people’s health, it is clear that the Coronavirus (Covid-19) outbreak will have severe economic consequences, and we are treating it as an economic emergency.

“We are determined to help keep companies in business and support them and their staff during this difficult time.

“Local authorities are the most efficient way to deliver this and we have worked closely with them to deliver these measures – and eligible businesses can apply now.

“Local authorities will aim to make payments within 10 working days, and I’d like to thank them for their help in ensuring this support is delivered as quickly as possible.

“The COVID-19 situation, however, is both severe and fast-moving and requires a coordinated UK response: I will continue to work closely with the UK Government and the other devolved administrations.”

More information on how to apply can be found at:
https://www.mygov.scot/non-domestic-rates-coronavirus/

Which? calls for mandatory transfer scam protections

Which? is calling for vital fraud protections to be made mandatory, as the consumer champion reveals more than £1 BILLION is estimated to have been lost to bank transfer scams in just three years.

With measures set to come in that should significantly reduce the amount of money lost to this type of fraud, Which? is also raising concerns that some banks are not committed to introducing the protections on time, or even at all.

Which? analysed bank transfer fraud statistics since the start of 2017, a few months after it first highlighted the threat from these devastating scams with a super-complaint.

The projected total lost since then, based on current trends, now stands at a staggering £1.1 billion, according to the research.

During that period, the sums lost to this type of scam, also known as authorised push payment (APP) fraud, have risen rapidly, while the payments regulator and banks have been slow to introduce much-needed protections for consumers.

According to Which?’s projections, £97 million could have already have been lost in the first three months of this year alone.

Alarmingly, analysis suggests that almost a third of the total losses since 2017, equating to £320 million, could have been prevented if a simple system of checking names on bank transfers had been in place during that period.

This important measure – known as confirmation of payee (CoP) – is finally due to be introduced by most of the UK’s major banks by the end of March.

CoP ensures that a check is made on whether or not the name a customer enters when making a payment matches the account details it is being sent to. It helps to stop fraudsters from posing as trusted organisations such as a bank or solicitor and tricking people into making payments to them.

The Payment Systems Regulator (PSR) has only directed the six biggest banking groups to sign up by 31st March, but Which? believes all banks must join the scheme in order for it to be effective.

The consumer champion asked all banks when they planned to introduce Confirmation of Payee.

Of the banks that have been directed to sign up, RBS Group (including Royal Bank of Scotland, NatWest and Ulster Bank) and HSBC (including First Direct) were unable to confirm a specific date when asked if they would be ready by the regulator’s deadline.

On the other hand, Lloyds Banking Group is ahead of the pack, implementing CoP from 2 March 2020 for Bank of Scotland customers, before rolling it out to Halifax and Lloyds customers throughout the rest of this month.

Of the banks that haven’t been directed to sign up by the regulator, several have said that they plan to deliver the system by the end of the year.

However, Metro Bank told Which? that it has no current plans to implement CoP at all – despite this being a requirement of the voluntary industry code on APP scams launched in May 2019, which Metro Bank signed up to.

It did not elaborate on why it is does not intend to introduce CoP, but says the voluntary code gives customers significantly increased protection against authorised push payment scams.

Metro Bank said: “We take our customers’ security extremely seriously and have a range of safeguards in place to help defend them against fraud, which we constantly review and update in light of increasingly sophisticated tactics from fraudsters.

“We have no plans to implement Confirmation of Payee currently, but can reassure our customers that they will continue to be protected. Metro Bank is a voluntary signatory of the Contingent Reimbursement Model Code, giving customers significantly increased protection against authorised push payment scams.”

Amid concerning reports of banks failing to follow the code’s rules around reimbursing blameless APP scam victims, Which? is concerned that a voluntary approach to ensuring victims are treated fairly is no longer viable.

The next set of UK Finance figures on bank transfer scams is due for release in the coming days. It should show an increase in the amount of money being reimbursed to victims of bank transfer fraud, as banks signed up to the code begin implementing the greater protections it offers.

Which? believes the code and CoP should be made mandatory and that the government must consider directing the PSR to ensure all banks are signed up. The consumer champion is also encouraging all consumers to put pressure on their bank to sign up to both the code and CoP.

Gareth Shaw, Head of Money at Which?, said: “The UK has been in the grip of a fraud crisis for years, but new security measures offered by the banking industry should finally give people better protection against increasingly sophisticated fraudsters.

“At the end of this month, we should get a true sense of how well the industry is tackling the issue. It is vital for all banks to commit to basic name-check security, and the whole industry should sign up and follow through on the protections offered by the scams code.

“If the banks fall short of making these commitments themselves, these initiatives must be made mandatory by the government.”

Chancellor: “Whatever it takes”

Chancellor announces additional £300 BILLION to keep UK afloat

The Chancellor Rishi Sunak has announced unprecedented support for business and workers to protect against the economic emergency caused by the coronavirus.

This includes unlimited loans and guarantees to support firms and help them manage cashflows through this period. The Chancellor will make available an initial £330 billion of guarantees – equivalent to 15% of UK GDP – and there could be more to come.

At last week’s Budget, the Chancellor provided £30 billion of support to the economy to deal with the crisis by investing in public services, increasing support for vulnerable people and providing business with tax reliefs and loans.

He said he would take further action as the situation evolved and today outlines further measures, including:

To ensure that businesses have access to the funds they need, \the UK Government will provide:

  • support for liquidity amongst large firms, with a major new scheme being launched by the Bank of England to help them bridge Coronavirus disruption to their cash flows through loans
  • increasing the amount businesses can borrow through the Coronavirus Business Interruption Loan Scheme from £1.2 million to £5 million, and ensuring businesses can access the first 6 months of that finance interest free, as Government will cover the first 6 months of interest payments
  • including new legal powers in the Covid Bill enabling us to offer whatever further financial support we think necessary to businesses

Providing £20 billion of business rates support and grant funding to help the most-affected firms manage their cashflow through this period by:

  • giving all retail, hospitality and leisure businesses in England a 100% business rates holiday for the next 12 months
  • increasing grants to small businesses eligible for Small Business Rate Relief from £3,000 to £10,000
  • providing further £25,000 grants to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000

Mortgage lenders have agreed they will support customers that are experiencing issues with their finances as a result of Covid-19, including through payment holidays of up to 3 months. This will give people the necessary time to recover and ensure they do not have to pay a penny towards their mortgage in the interim.

Confirmation that government advice to avoid pubs, clubs and theatres etc. is sufficient for businesses to claim on their insurance where they have appropriate business interruption cover for pandemics in place.

To support the food industry and help provide meals for people who need to self-isolate, the UK government will relax planning regulations to allow pubs and restaurants to start providing takeaways without a planning application.

The Chancellor of the Exchequer Rishi Sunak said: “We will do whatever it takes to protect our people and businesses from the effects of this global economic emergency brought on by the Coronavirus pandemic.

“The interventions I am setting out today will help support businesses of all sizes – so they can continue operating during these unprecedented times.”

The action announced yesterday means that over £3.5 billion in additional funding will be provided to the devolved administrations for support to businesses in Scotland, Wales and Northern Ireland.

The Chancellor will expand on his plans to keep the economy afloat later today and an announcement of support for people who live in rented accommodation is expected this week.

Labour’s John McDonnell MP, Shadow Chancellor, responding to Chancellor Rishi Sunak’s coronavirus update, said: “People are being laid off today and losing their incomes. We are disappointed that this package does not address their concerns.

“The further announcements laid out by the Chancellor lack the certainty required amidst growing public anxiety and still do not go far enough in protecting workers, renters and those who are losing their jobs, or in fully supporting businesses at the scale necessary.

“In particular, the Chancellor’s claim that new forms of employment support will be developed does not appreciate the urgency and gravity of the situation. Workers and businesses need to know now that they will be supported, not in a few days’ time.

“Labour will continue to engage with the Government to ensure we have the proper scale of interventions required to secure proper funding of public services at the time of crisis, public control and oversight of those key services, a strong safety net, and the wellbeing of all.”

Gareth Shaw, Head of Money at Which?, said: “The measures announced by the chancellor, such as a three-month mortgage holiday scheme, are an important first step to helping millions of consumers who may face financial hardship during the coronavirus crisis.

“The government must move swiftly to ensure those in need of assistance get clear information about how these schemes will work in practice – and that the process for doing so is straightforward, ensuring consumers can easily access the support they need in the challenging months ahead.”

Responding to chancellor Rishi Sunak’s package of support for businesses and the prime minister’s pledge to do `whatever it takes’ to support people and jobs through the corona virus crisis, the head of the UK’s leading union, Unite, has said that his union stands ready to play their part throughout this time of crisis.

Len McCluskey, Unite’s general secretary said: “It is abundantly clear that we need a package of measures equal to the public health and economic emergencies now upon us.

“Urgent and considerable action is needed by government to avert personal and industrial catastrophe.

“Unite is pleased to have heard the prime minister and chancellor say very clearly that they `will do whatever it takes’ to protect public health and the economy’s health.  We will hold them to that.

“However, we remain extremely concerned that workers’ and individuals’ own capacity to act on the public health advice will remain seriously compromised because the direct economic support has not yet been provided by government. This must change and urgently.  Providing wage support and covering rents must be a priority.

“It is welcome that those hit by the virus will have a three month mortgage holiday should they need it, but what about the vast majority of people who rent? They need to know that they can put food on the table and keep a roof over their families’ heads. Only then will they feel able to play their part in tackling this public health emergency.

“We urgently need for the government to introduce now the sort of measures that we have seen implemented in our competitor nations, including paying workers 75 per cent plus of their salary while they are forced to be at home as has been introduced in Denmark and Holland.  UK workers deserve the same efforts and assistance.”

 

Women’s mental health hit by financial worries

Research shows women more likely to suffer from poor mental health than men thanks to heightened financial concerns – and young women hit worst

Women suffer from greater money worries than men, a study has shown this International Women’s Day.

Research has revealed that just under half (41%) of working women in the UK have money worries, a figure that dips significantly down to less than a third (32%) for men.

Statistically, the figure is also higher in younger women with 55 per cent of women aged 16-24 reporting money worries, and 53 per cent of those aged 25-34.

The recently reported research was carried out by Salary Finance, an employee financial wellbeing platform, and also revealed the shocking impact of these figures on women’s mental health.

The stats show that women with money worries are much more likely than their male counterparts with the same concerns to be suffering sleepless nights (51% to 43%), anxiety and panic attacks (62% versus 57%) and are more likely to have depression and suicidal thoughts (71% versus 65%).

These figures mean that when compared to those with no money worries women with financial concerns are over five times more likely to have anxiety and nearly seven times more likely to have depression. For men with financial worries, it is far less – they are 1.3 times more likely to say they’re suffering from anxiety and/or depression due to financial problems.

It’s also more likely that you will run out of money before pay day if you’re a woman, according to these statistics. Over a third (34%) of women are running out of money before pay day each month, compared to just under a quarter (24%) of men. Younger women were again much more highly impacted, being much more likely to run out of money before pay day.

Of course, the impact of maternity leave is keenly felt by the female workforce. Of those surveyed that took maternity or paternity leave, a massive 73 per cent of women said they took on additional debt as a result, compared to just 27 per cent of men. Yet resulting childcare costs did not cause significantly higher levels of stress for women.

Asesh Sarkar, CEO and co-founder of Salary Finance, commented: “In 2020 it’s disheartening to see such a discrepancy between financial wellbeing in men and women. Our extensive research has shown the crippling impact that money worries can have on the UK workforce, and see these figures that show women suffer much more.”

Although there were many differences the survey did reveal that there are no notable differences in the approach to savings between women and men, suggesting attitudes and behaviour play a far bigger role in saving habits than gender.

Another similarity between men and women was an apparent unwillingness to discuss their finances. This highlights a general attitude rather than a gender-specific issue.

Asesh added: “Whilst the figures show that women are suffering more as a result of poor financial wellbeing, it’s important to remember that financial stress and concerns affects a wide range of people, regardless of gender, age or salary. 

“There is a need to tackle the stigma attached to discussing financial concerns and this is where financial solutions in the workplace can help. It is therefore important for employers to take an interest in the financial health of their employees.

“Our research has shown that around 77 per cent of workers feel they can trust their employer when it comes to sharing personal information. This really highlights the role that employers can play when it comes to tackling the issue of poor financial wellbeing amongst the UK workforce.”