The group will also act as a group that will focus on addressing challenges for the sector including creating a regulatory framework that supports innovation and growth while addressing issues such as consumer protection and economic crime.

Lisa Cameron MP, chair of the new group, told the media, “We must ensure that we have an appropriate regulatory framework in the UK which supports innovation and guarantees that the UK remains an attractive destination for innovative firms to set up and grow. It is equally vital that we have a clear regime to protect consumers, ensuring they understand the risks, and are protected from the risk of economic harm posed by fraud and scams.”

The crypto advisory group was officially registered with the parliament last week and the members include former Digital Economy Minister Ed Vaizey and Tory MP Harriett Baldwin, a former JPMorgan executive.Cryptouk, a trade association for digital assets, will serve as the parliamentary group’s secretariat.

Previously, crypto advocates have warned that the UK government has been late to establish rules for digital asset businesses, which risks driving them offshore. The Financial Conduct Authority (FCA) also banned crypto derivatives for retail investors and also opposed crypto funds.

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Huw Evans, director-general of  Association of British Insurers told the media, “There are winners and losers in the way the market works currently, with those who switch insurance providers every year often ending up with lower prices. The FCA has confirmed that insurers have not made excessive profits.” 

The ban is in fact expected to stop automatic renewal, according to the regulator. The reason for the ban is because car and home insurance markets are not beneficial for customers. It is reported that consumer group Which? was open to the new rules introduced by the authority. 

In fact, insurers and brokers have already started to address the issue associated with price differences between new and existing customers in the industry. It is reported that industry has observed more than 8.5 million ‘pricing interventions’ in home and motor insurance worth £641 million. However, several insurance companies across the country will begin to adhere to the rules introduced by the Financial Conduct Authority. 

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The company said in a statement, “There may be a delay before all card programmes are fully operational, so some customers could find themselves unable to transact immediately but we anticipate this lasting no longer than 24 hours. We apologise for the inconvenience to our valued customers that the temporary suspension caused.”

The Financial Conduct Authority (FCA) has lifted restrictions allowing Wirecard to resume its banking operations in the country. The authority told the media, “The primary objective of these requirements was to protect the electronic money funds of consumers in safeguarded account. It also had the effect of preventing consumers from withdrawing and making payments with those funds.”

Last week, the company filed for insolvency following a disclosure of missing funds. After that, the authority had forced the company to stall financial operations in the country. The lifting of restrictions will benefit all its consumers who had temporarily lost access to their funds.

Experts believe the situation with Wirecard will have a negative impact on people, leading them to lose faith in financial services companies. Last week, the company said in a statement, “There may be a delay before all card programmes are fully operational, so some customers could find themselves unable to transact immediately but we anticipate this lasting no longer than 24 hours.”

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In light of this slow but definite change of mindset comes news that Caxton, a London-based international payments and forex expert, obtained its licence to roll out an open banking solution for its platform earlier this year. The Financial Conduct Authority (FCA) authorised Caxton to provide two new services, through which Caxton’s customers will have visibility of each individual account they hold with their other banks, whilst they use the digital platform provided by Caxton. The company states that this will make payments faster and more convenient in multiple currencies.

CAXTON’S APPROACH TO OPEN BANKING
Rupert Lee-Browne, who started the company in 2002, believes innovation is a cornerstone to success and creating new opportunities in the financial services industry. And open banking is a phenomenal opportunity to achieve this, he says. “Open Banking gives companies like Caxton access to information that we wouldn’t have been able to obtain otherwise.” Through the newly-acquired AIS and PIS certifications, Caxton is excited at the prospect of serving customers more efficiently.

The changing mindset can be attributed to the quality of technology being developed and the variety of use-cases they solve. Caxton has partnered with Token, its main technology provider to roll out AIS and PIS. AIS is Account Information Service, a new type of regulatory permission that allows customers to view multiple payment accounts with different firms through their online access at one CURRENCY payment firm. PIS stands for Payment Initiation Service—this new regulatory permission allows customers to authorise a financial transaction between two accounts after they have been linked by the customer. AIS is useful to procure information about client transactions and history, while PIS allows Caxton to make transactions on behalf of the client with their permission.

Earlier this year, Caxton integrated with Token to enable customers easy loading of their prepaid currency cards with funds directly from their bank accounts via Caxton. Diverting payments through Token, as opposed to debit card rails decreases the cost of payment acceptance by more than 50% and enables instant processing. According to the company, this new settlement time frame improves cash flow management.

Lee-Browne says, “With technology, we’re able to achieve so much. Not only is tech making diverse use cases possible but is also very safe.” Caxton processed millions of transactions last year and has an annual turnover of more than $1.1 billion. For the next year, Lee-Browne is aiming to address the currency needs of corporates and SMEs, which he believes are quite under-served.

INNOVATION A CORNERSTONE FOR SUCCESS AT CAXTON
This need for innovation is not new for Lee-Browne. He started Caxton 15 years ago with a telephone and 25,000 GBP in hand, and launched a prepaid currency card service that was unheard of. Thanks to a Google ad, he procured his first client in less than 20 mins and the ball hasn’t stopped rolling ever since. “What I’m proud of is our organic growth in acquiring clients. When we launched, we witnessed a need for currency cards and dove into making that a reality for customers. Today, with buzzwords like open banking and advanced tech, our endeavour is to keep the suite of new services and products rolling that are in line with the current market needs.”

Lee-Browne is very perceptive of the change in mindset towards tech as he believes conventional organisations have finally understood that tech is here to promote business, mitigate overhead costs, enhance innovation and generate new revenue streams. Particularly pertaining to his line of work, Lee-Browne is of the firm belief that technology only makes customer service better. “If you combine tech with customer service, you don’t need to go by the old adage of tech will replace customer service. I think the two go hand-in-hand. Technology should enable us to serve our customers better, not look to replace human interactions.”

When Open Banking was introduced, there was a lot of nervousness among banks, admits Lee-Browne. And though its been eight months since Open Banking rolled out, progress has been slower than anticipated. Lee-Browne says, “New concepts and services have always taken time to grow on people, especially in the payments space. Contact-less payments, for instance, has taken more than a decade to gain the popularity it enjoys today.”

He anticipates that banks will continue to be selective about who to work with, but attitudes are definitely changing, and this could spell a positive time for companies like Caxton and hundreds of others that have cutting-edge tech and innovative customer service solutions.

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Andrew Bailey, Chief Executive of the Financial Conduct Authority, said: “High-cost credit is used by over three million consumers in the UK, some of who are the most vulnerable in society. Today, we have proposed a significant package of reforms to ensure they are better protected including the possibility of a cap on rent-to-own lending.

“The proposals will benefit overdraft and high-cost credit users, rebalancing in the favour of the customer.

“Our immediate proposed changes will make overdraft costs more transparent and prevent people unintentionally dipping in to an overdraft in the first place. However, we believe more fundamental change is needed in the way banks charge customers for overdrafts. Given the size of the market our work here will be completed as part of our wider review into retail banking.”

Under legislation the FCA is required to formally consult on rules it proposes to introduce. Consultations must be open and transparent, and the FCA cannot prejudge the result. In order to consult, the FCA must have a sufficient evidence base to build its proposals and develop a cost-benefit analysis, which is why the FCA has launched this call for input. These checks and balances ensure any proposed measures are proportionate and necessary to protect consumers.

Overdrafts

The FCA believes that the way banks operate and charge for overdrafts needs fundamental reform. In 2016, firms made an estimated £2.3bn in revenue from overdrafts; 30% of this was from unarranged overdrafts. The majority of unarranged overdraft charges are paid by only 1.5% of customers, who pay around £450 per year in fees and charges.

The FCA is putting forward some immediate proposals today for overdrafts that it believes will save customers up to £140mn a year. Beyond that, the FCA will consider more radical options to ban fixed fees and end the distinctions around unarranged overdraft prices.

If appropriate, these options will be consulted on later this year to coincide with the wider Strategic Review into Retail Banking so that the FCA is able to take into account the part that overdrafts play in the current UK banking model.

The FCA is also consulting on mandatory rules to make it easier for customers to manage their accounts.

These include:

• mobile alerts warning of potential overdraft charges
• stopping the inclusion of overdrafts in the term ‘available funds’
• requiring online tools to make the cost of overdrafts clearer
• introducing online tools to assess eligibility for overdrafts
• making it clear overdrafts are credit or borrowing

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Mr. La Salle, FCPA, FCA, has over 20 years of experience in the development and operation of mining projects in West Africa. In 1995, he founded Canadian-based SEMAFO Inc., which grew from a junior explorer to a 250,000-plus ounce-per-year gold producer in West Africa.

Mr. La Salle has been, and remains, a key stakeholder, an investor, a chairman, a board member or an executive of many public and private sector companies, primarily in the mining, energy and cleantech sectors where he has been a strong proponent of transformational change and shareholder value creation.  Mr. La Salle has also given back through his involvement in several large NGOs in Canada and Africa.

Concurrent with the above organisational change, Mr. Francois Auclair, M.Sc, FGAC, PGeo, formerly the CEO, will assume the key role of Executive Vice-President, Exploration, focusing on the successful execution and continued development of the Algold Tijirit Gold Project in Mauritania.

Mr. Auclair will also lead the exploration team in the identification of prospective new gold projects in West Africa. Mr. Auclair has an extensive and successful track record of gold discovery and project growth in Africa, and has been responsible for the identification and/or development of a number of gold mines in Africa and internationally.

As part of its regular ongoing 2017 annual compensation program, the Corporation has granted 821,429 deferred share units (“DSUs”) to three officers of the “Corporation”, one of whom is also a director, in respect to their 2017 compensation, at a price of $0.14 each. These issuances were made under the Corporation’s DSU Plan.

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The chair of the House of Lords Financial Exclusion Committee, Baroness Tyler of Enfield has labelled the financial services sector in the UK a world leader, and that makes the situation ‘doubly unacceptable that it is failing those who need it most’.

Current statistics show that in excess of 1.7 million people in the UK don’t have a bank account, and 40% of the working population have less than £100 in savings. The figure of elderly people that are financially excluded is around 600,000 and more than 50% of 18-24 year olds worry about money regularly.

The report states that the government should demonstrate its commitment to expanding the remit of the FCA to give priority to tackling financial exclusion and work with them to establish new regulations, which will push the banks to have a duty of care towards their customers. Furthermore, the report called for better financial literacy and examining the relationship between disability, mental health issues and financial exclusion.

But do the FCA shoulder some of the responsibility for the creation of the financial exclusion?

In 2015, Westminster let out a cheer when the FCA clamped down on short-term ‘payday’ loans. However, during the last two years, this has led to banking industry experts question whether the clamp-down on the industry has caused further problems.

The regulatory clamp-down meant that lenders were required to carry out more stringent affordability checks and price caps were placed on loans, resulting in lower borrowing costs. Along with this, the advertising strategies used by some firms came under scrutiny and Google banned search ads from payday lenders.

Recent, albeit early, evidence from debt charities and industry bodies have uncovered that an increasing number of people are ‘locked out’ of credit markets – forcing them to seek other forms of finances – commonly in the form of high-cost loans from companies that are flying under the radar of the FCA regulations.

Even Jane Tully, from the Money Advice Trust, who initially welcomed the cap enforced by the FCA now worries it has led to the problems being displaced. “You can regulate away the supply but you can’t regulate away the demand. Potentially, there could be people accessing different forms of credit and they’re more likely to fall into debt because there isn’t the credit available”.

The lending cap was introduced to protect borrowers by tightening practices, but in reality, it has led to the supply of these short term loans being restricted, leaving many without the means to borrow. For example, after experiencing plunging revenues, three of the leading payday lending firms were forced to withdraw from the industry, and business within the sector have repositioned themselves, now marketing themselves to a higher demographic.

One of the main areas of concern is the sharp increase in utility bill payments being missed since the cap was introduced. The reality is that this cap, that was introduced with good intentions, has left people facing ‘impossible decisions’. This comes from Laura Rodrigues, policy advisor for debt charity Step Change. The charity reported that 40% of its clients miss a bill payment or turn to alternative means of short-term credit if they are turned down from a payday loan application.

The people that have been locked out of short-term loans due to the stricter checks are now turning to products that are even more expensive, not subjected to regulatory scrutiny and not yet price capped. These include products such as guarantor loans, logbook loans and unauthorised overdrafts.

While payday loans have long come under regular scrutiny for the high level of APR, when compared to the fees associated with unauthorised overdrafts from many of the high-street banks, they are the less expensive option.

Since January 2015, the cost of a payday loan was capped at a maximum of £122.40 per £100 borrowed for 28 days. Although high, this is less than an authorised overdraft that sits at £30 for a 28-day period, or £90 for an unauthorised overdraft. It was found by Which? that NatWest imposed the highest charges at £180 for borrowing over 30 days across two billing periods.

Payday loans, like bank overdraft facilities, are considered to be an ‘emergency lending’ product, used in situations where problems arise that were not accounted for, or to solve immediate cash flow shortages. But while payday lenders were relatively new to the financial scene, and were subjected to scrutiny, the same tactics used by the banks have long been accepted as the ‘norm’, and the general consumer view is that the fees are there to act as a deterrent. The truth is, these overdrafts have long been a main revenue maker for banks – and in 2015 alone, they generated over £1 billion.

It is with a sigh of relief that there is now growing pressure on the banks to lower these fees and improve their levels of transparency. One of the strategies that has been implemented is to send text alerts to customers when they have reached their overdrafts – this saved those individuals over £100 million collectively. Last year, the FCA launched a review into launching a cap on unauthorised overdraft charges; it is currently gathering evidence and is planning to publish the findings by summer 2017.

While the caps on payday loans and bank overdrafts go a long way to preventing individuals entering a cycle of ‘problem debt’ and reducing the financial exclusion, it is widely known that the repayment schemes imposed by banks on overdrafts requires a critical review. Lending firms offering short-term products make no secret of the levels of APR that applied to their products, while many banking customers are oblivious to the charges until after the fact.

Danny Malone is CEO of Everyday Loans 

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