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April 6, 2020

International Islamic Trade Finance Corporation provides US$850m

Societies and economies are being affected by the unprecedented and unpredictable nature of the COVID-19 pandemic. These include a major shift in global trade routes, changes in consumption and extraordinary levels of monetary easing and stimulus packages at a scale never experienced before. The International Islamic Trade Finance Corporation (ITFC) is moving quickly to consolidate efforts to mitigate the socio-economic risks that the virus poses to all our stakeholders in member countries of the Organization of Islamic Cooperation (OIC).

As we assess how COVID-19 affects the work we do and the impact on member countries, ITFC is engaging closely with government stakeholders, partners, businesses and the financial institutions we work with. That dialogue enables us to respond in a coordinated manner to soften the economic fallout. This is in addition to practical measures that have already been taken.

ITFC has moved quickly to put in place emergency financing measures to ensure that member countries continue to receive the support needed. Our COVID-19 ‘Rapid Response Initiative’ (RRI) has made US$ 300m immediately available.

ITFC is also responding to the different requests made by member countries to provide immediate crisis-related technical assistance programs, including capacity building for medical personnel and capacity enhancement of laboratories. ITFC is also assisting in sourcing medical equipment and medicines from its network.

These funds are being directly funnelled towards eligible OIC member countries in most need of support – for critical supplies of energy, healthcare, food security and other life support requirements. ITFC is in continuous consultations with OIC member countries to ascertain their most pressing needs as the pandemic unfolds.

An additional fund – the ‘Recovery Response Program’ (RRP) – earmarks another $550m for deployment over the next two years. The RRP is aimed at fixing the socio-economic damage which is expected to last longer than immediate impact of the virus.

ITFC is actively engaging international, regional and local partners as a strategic means of scaling these interim financing measures to contribute to the critical needs of the member countries and where necessary, on the mobilisation of trade development support services during the pandemic. This includes helping OIC member countries with strategies for the control and production of healthcare facilities.

ITFC employees continue to work remotely through virtual platforms and other online means of communication, to ensure business is running as usual. We remain fully engaged and responsive to the business and socio-economic needs of the many millions of people we serve.

Whilst the challenges and impact of COVID 19 continue to evolve, we are certain by uniting and standing in solidarity with our member countries, we will overcome the crisis.

April 3, 2020

Government allows firms to rehire and furlough staff who left for other jobs

After a campaign by MoneySavingExpert.com founder and chair, Martin Lewis, the government has agreed to change its Coronavirus Job Retention Scheme guidance, in order to clarify that firms can rehire and furlough those who left for other jobs, which then fell through due to Covid-19.

Under the scheme, a firm can choose to put employees who were on the payroll on 28 February 2020 on furlough (a bit like a standby mode), where they don’t work, and the state finances 80% of their salary up to £2,500. Employers can top this up to 100%, but are not required to. Full information is in the MSE coronavirus employment rights guide.

Official guidance has always stated that they can rehire and furlough staff they’d made redundant after 28 February. Earlier this week, Martin got confirmation that nothing explicitly prevented firms from doing the same for staff who’d left and whose plans were then derailed due to the coronavirus.

Yet without seeing this in black and white from officials, many employers said it couldn’t be done. So after further discussion with Martin, HMRC agreed to provide MSE with the following statement, and to change the official guidance as soon as possible.

A government spokesperson said: “The Coronavirus Job Retention Scheme is aimed at those who would otherwise be unemployed as a result of coronavirus. It allows for those who were on the payroll of a company on 28 February but subsequently left to be put back on payroll and furloughed.

“This includes those who have resigned to start a new job after February 28. They may return to their old employer but decisions around whether to offer to furlough someone are down to the individual company.”

Martin Lewis comments: “I’m grateful to the Treasury and HMRC for the official statement and agreeing this amendment to the guidance. Via the furlough scheme, the government has outsourced an arm of the emergency welfare state to corporate Britain, and made it the gatekeeper of this new form of wealth support. The hope is this will allow us to restart the economy quickly when we come out of lockdown.

“For that to work well, we need employers to take on a moral duty to deliver these responsibilities for the betterment of individuals and the economy. If they re-recruit someone and furlough them, they can put them on 80% of their salary – and the state pays all that salary plus national insurance and any pension contribution. There’s no cost to the firm, though there may be a short-term cash flow issue.

“While I’ve heard many cases of firms furloughing those they had made redundant, those in need who left voluntarily have met a brick wall. Some firms have simply been unwilling, and sadly the rules have given them full discretion, leaving those affected nowhere to go. Yet others have good relationships with their former colleagues and have told them, ‘we would if we could, but the rules don’t allow it’.

“Well now it’s official, the rules do allow it, and it would be wonderful if they deliver. Employees who left after 28 February having resigned for a new role that fell through due to the coronavirus can be rehired. This includes both those who didn’t start the new job, and those who did, but now face redundancy because they were new starters after 28 February, which means they can’t be furloughed.

“Though to be clear, where the unemployment isn’t caused by the coronavirus, for example someone who voluntarily left a job to take a few months off to travel the world, the rules don’t allow them to be rehired in order to be furloughed.”

April 2, 2020

Employers must remember duty of care during outbreak

Throughout the coronavirus pandemic, businesses must ensure that they’re providing suitable mental health support for employees and fulfilling their duty of care to workers, says workplace stress and mental health organisation, Mente.

The current situation with coronavirus is clearly unprecedented and is causing worry for many businesses, employees, and individuals, says Mel Joseph, founder and managing director of Mente.

Mel commented, “This is a challenging time for everyone and every business in the country. But businesses need to recognise that the potential impact on employee mental health could be severe and long-lasting if wellbeing is ignored. Businesses have a legal obligation to protect employees from harm, and this can include harm to their mental health as a result of excessive work-related stress.”

She added that it’s important to remember that your duty of care extends to employees who are now working from home. Mel said, “It’s important to take the health of remote workers seriously. Businesses with five or more employees are required to do a risk assessment for stress, and you should now be covering remote workers in this stress risk assessment.”

The latest research from YouGov, conducted on 30th March, shows that 48% of workers are now working from home at an increased level. 46% of workers also report that they are now working from home all of the time.

Mel suggested, “Good communication is more important than ever, so encourage regular conversations between managers and colleagues. Also try to ensure that the business cascades information in a timely manner to avoid worries and office gossip about job security from escalating. Reassure employees that you take their mental health seriously and will support them however possible.

“Now is also the time to be reminding employees about the support that is available to them. If you have any healthcare provisions that they can use, like an employee assistance programme, let them know how to access it.”

By taking the right steps, businesses can mitigate the risk of poor mental health on employees. It can also be good for the business, as employee wellbeing translates into increases in employee and customer loyalty, and improvements in productivity.

Mente help businesses to manage stress and mental health through their digital platform, which houses CPD accredited mental health training, business diagnostic and performance tools, and direct access to further support. They have recently launched a new free stress risk assessment tool, specifically for organisations with employees who are working from home.

April 1, 2020

APSCo writes to chief executive of British Business Bank

Responding to reports of disparate approaches taken by the banks to recruitment firms looking to apply for finance via the Coronavirus Business Interruption Loan, Ann Swain, the chief executive of the Association of Professional Staffing Companies has written to Keith Morgan the chief executive of The British Business Bank expressing major concerns. The letter has also been copied to the Economic Secretary to HM Treasury John Glen.

Dear Mr Morgan,

I am writing on behalf of the Association of Professional Staffing Companies (APSCo) to highlight some of the challenges which our members have encountered when applying for finance via the Coronavirus Business Interruption Loan Scheme.

By way of background APSCo is the representative body for the professional recruitment sector and is comprised of approximately 1000 recruitment and affiliate members from start-ups to listed global groups. Many of our one thousand recruitment industry members are SMEs operating across the professional staffing sectors, primarily in STEM, banking and finance and general professional, including teaching and qualified social work.

APSCo and our members appreciate the multi-layered support the government has extended to private sector businesses and in particular SMEs, to allow them to trade out of the economic crisis brought on by coronavirus, and it is very much our role to offer guidance and support to our members as they seek to access this support.

Unfortunately, many of our members have contacted us to express concern about the ease of access to the Coronavirus Business Interruption Loan Scheme (the Loan Scheme) and their eligibility for it. This concern was evidenced by the results of our recent membership survey in which a third of respondents, all within scope of the Loan Scheme, said that the criteria are prohibitive, and the application process is complicated and difficult.

We know this is also of concern to HM Treasury as evidenced by their open letter of 25 March in which they state the priority for all of the financial sector must be to ensure that the benefits of the measures implemented by government are passed through to businesses and consumers, which will require a willingness to extend lending despite the uncertain economic conditions.

Due to the nature of our work, the recruitment sector has been particularly affected by impacts on cashflow and has suffered from the almost total freeze in the professional employment market. Recruiters pay agency workers before they are paid by their clients, and they are also being asked by government to fund furlough for agency workers under the Coronavirus Job Retention Scheme prior to the reimbursement scheme going live.

It is therefore vitally important that the Loan Scheme is accessible for our members, who have reported that some of the challenges experienced in accessing it include:

  • A lack of transparency around eligibility and the criteria applied.
  • Disparate approaches taken by the banks, particularly on eligibility.
  • Requirements for personal guarantees and extremely high rates of interest, despite the government backed security; and
  • Sales techniques adopted to persuade customers to use other, non-government banked, forms of credit.
    The overriding issues are a lack of consistency in the exercise of the banks’ discretion in applying the Scheme, and an unwillingness to relax normal lending rules. We accordingly ask for:
  • Transparent, publicly available guidance to be issued by the British Business Bank directed at the banks, on applying discretion in decision making on eligibility, credit worthiness and appropriateness of the scheme to individual circumstances.

Public, auditable and swift measurement of the banks’ adherence to such guidance, giving credit for transparency, speed of processing of applications, numbers and value of loans provided under the scheme.
We appreciate that many retail banks may be cautious of allegations of mis-selling loans to customers after the coronavirus economic crisis has abated. Nonetheless, we consider that they are failing to take heed of HM Treasury’s request for cooperation and flexibility as set out in its letter. Hence, steps must be taken to require them to apply the scheme fairly, equitably and with the primary aim of protecting SMEs and the wider economy in the mid to longer term.

APSCo recognises that the British Business Bank will have likely received many representations from other organisations highlighting similar issues which have been encountered, and we hope this contribution can help the BBB to further shape and administer the Loan Scheme in line with the spirit of what the government intends.

Ann Swain
Chief Executive, APSCo

March 27, 2020

Tink acquires Spanish account aggregation provider, Eurobits Technologies

The acquisition complements Tink’s organic growth strategy to enhance its platform, increase connectivity and expand its product offering. The acquisition of Eurobits builds on the €90m investment secured in January 2020 and will see Tink increase its bank and financial institution connectivity in 17 markets, predominantly in Europe and in Latin America. Eurobits brings significant international fintech and banking customers, including BBVA, Santander, Bankia, Sabadell, Fintonic, Telefonica, National Bank of Greece and La Banque Postale (France).

Eurobits serves some of the largest fintechs and financial institutions across Europe, providing connectivity to bank account information for banks, fintechs and payment providers. The account aggregation services provider, founded in 2004 and headquartered in Madrid, is renowned for its strong partnerships with many leading banks and fintechs in Spain. Eurobits is live with customers in 11 markets, handling more than 50 million account aggregation requests every month.

In addition to its European focus, Eurobits also serves customers with account aggregation services in Mexico, Chile, Colombia, Argentina and Peru.

Eurobits’ 54 employees will become part of the Tink team.

Arturo Gonzalez Mac Dowell, CEO, Eurobits, said: “Tink is undoubtedly one of the most innovative companies within open banking. Joining forces with them to help expand their coverage across Europe and Latin America is a unique opportunity, not only for both of our businesses, but for the broader industry as a whole. We cannot wait to join forces with Tink to create an even stronger European market leader in open banking.”

Daniel Kjellén, co-founder and CEO, Tink, continued: “We are extremely impressed by the Eurobits team, what they have built and their very strong position in Southern Europe. This acquisition is part of our ongoing investment into our pan-European open banking platform that through this move will be live in 17 markets. Not only does it strengthen our platform through increased connectivity, it also gives existing Eurobits customers access to our payment initiation and data services. We look forward to coming together with Eurobits to enhance the connectivity and open banking technology for Europe’s banks, fintechs and startups.”

Ana Climente Alarcón, head of open banking, BBVA Spain, added: “Open banking is transforming finance – increasing financial inclusion, and helping our clients have a bird’s eye view of every aspect of their financial lives in one place. Tink and Eurobits joining forces is a significant moment in the industry, with two leaders in the open banking space coming together with a common vision of making open banking more accessible for everyone.”

Lupina Iturriaga, CEO, Fintonic, added: “It’s an exciting time for the finance industry with open banking revolutionising the financial products and services on offer to customers. By joining forces, Tink and Eurobits can apply their combined experience and expertise to support businesses like ours to build new use cases, enhance customer experience, and drive growth. We look forward to working with them going forward.”

Tink acquires Eurobits for €15.5m. The acquisition is conditional upon approval from the national competent authorities.

Tink’s technology and connectivity already power some of the world’s leading banks and fintechs, including PayPal, Klarna, NatWest, ABN AMRO and BNP Paribas. The open banking platform is also used by more than 5,000 developers. Founded in 2012 and headquartered in Stockholm, Tink is currently serving its clients out of local offices in London, Paris, Helsinki, Amsterdam, Warsaw, Madrid, Copenhagen, Milan, Oslo and Lisbon.

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