Credit Management magazine October 2017

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Report shows retirement pots are shrinking AROUND a third of all adults (32 percent) are failing to invest in order to support their lifestyle in retirement, a new study from Close Brothers Asset Management has found. This is despite the fact that more than one in three (35 percent) are concerned about not having enough money in their pension pot to retire, while more than a quarter (27 percent) are worried there will not be enough cash available when they retire to cover emergencies. Even with these worries, more than a third (36 percent) do not plan to increase the size of their contributions into their pensions, while 15 percent say they do not plan to retire at all. The study found that confusion about the options available is preventing adults from saving and investing effectively. One in five British adults said they were worried about which retirement option would suit them best, with a quarter saying that they found changes to the pension system – such as the introduction of the pension freedoms confusing. David Newman, Head of Pensions at Close Brothers Asset Management, says it was crucial to close the gaps in both pension saving and knowledge: “Auto enrolment has boosted the number of people contributing to a pension but the Making tracks HITACHI Capital (UK) has announced plans for further European expansion for the business following a planned new branch office opening in Amsterdam, Netherlands in September. The branch office is the second business Hitachi Capital has established in the Netherlands, following the recent acquisition of Noordlease Holdings B.V in January this year. The Netherlands branch will provide vendor finance solutions to Hitachi and Mitsubishi group companies, whose European head offices are based in the country. hitachicapital.co.uk Figures from the Department for Work & Pensions last week revealed that the average age of people exiting the work force has increased over the past two decades. amounts being put aside each month are simply not enough. “Putting aside the bare minimum will not guarantee that the next wave of retirees will have the necessary income in retirement. Working in later life should be a choice not a necessity, and it’s a concern that around one in seven people expect never to retire.” Figures from the Department for Work & Pensions last week revealed that the average age of people exiting the work force has increased over the past two decades, while the employment rates of people over the age of 50 have also increased. closebrothersam.com Equifax partners with Ensek EQUIFAX and ENSEK, a leading UK energy solutions company, have formed a joint partnership to support identity verification and credit assessment services for new-tomarket energy suppliers. The integration between Equifax and ENSEK will supply real-time consumer and commercial data to energy providers, enabling them to onboard new customers more efficiently as part of an automated process. Equifax says that the insight provided will give energy firms a better understanding of customers at the point of registration, helping to mitigate the risk of fraud and bad debt. The solution is offered within ENSEK’s advanced technology platform, and the firm claims that its clients will benefit from seamless integration of Equifax insights into their customer registration process. equifax.co.uk >NEWS IN BRIEF GOLD STANDARD 1ST Credit has achieved gold standard from Investor in Customers (IIC) for ‘exceptional’ customer service for the fourth year running. 1st Credit increased its scores across the board – from customers, staff, management and independent assessor IIC. The company achieved an overall score of 8.86 out of 10, up from 8.50 in 2016 and its third consecutive year of increases. The results showed the company’s staff to be highly motivated and encouraged to tailor plans to individual customer needs. In total, more than 98 percent of team members said treating customers fairly is an everyday priority in the business. 1stcredit.com GIRL POWER More women are seeking financial advice due to increasing rates of divorce and the rise of female entrepreneurs, according to a study by Investec Wealth and Investment. The research among intermediaries found that women accounted for two-fifths (40 percent) of IFA clients in 2012 but 47 percent of new clients gained over the past two years. Over a quarter (26 percent) of advisers said one of the main drivers behind the increase in female clients is they are taking more control of their financial circumstances; a fifth (19 percent) cited the growth of women succeeding in business. However, the biggest factors are divorce (51 percent) and the death of their spouse (35 percent). investec.com PSOGD CLOSES The Payment Systems Regulator (PSR) and Bank of England (BoE) says that the Payment System Operator Delivery Group (PSODG) has completed the necessary steps to deliver against the mandate that the regulators tasked it with. Following the appointment of Melanie Johnson as its first chair, work will continue to deliver the New Payment Systems Operator (NPSO) by the end of 2017. With the NPSO now taking the lead, the PSR and the BoE have confirmed the closure of the PSODG. psr.org.uk bankofengland.co.uk The Recognised Standard / www.cicm.com / October 2017 / PAGE 10
INSOLVENCY Pre-packs – back on the agenda As numbers of Pre-packs are expected to fall to an all-time low, David Kerr explores where the issues may lie. AUTHOR – David Kerr MCICM is the Chief Executive of the Insolvency Practitioners Association (IPA). David Kerr NOISE levels around Pre-pack administrations may be lower than they have been in the past, but there are quiet rumblings in the insolvency world about this procedure, how it affects creditors, and the potential for legislative change. The term ‘Pre-packaged sale’ refers to an arrangement under which the sale of all or part of a company’s business or assets is negotiated with a purchaser prior to the appointment of an administrator, and where the administrator then effects the sale immediately on, or shortly after, his/her appointment. The nature of an insolvency practitioner’s position renders transparency in all dealings of primary importance and particularly so in these circumstances. Administration is a collective insolvency proceeding – creditors and other interested parties should have confidence that the insolvency practitioner has acted professionally and with objectivity, and failure to demonstrate this clearly may bring the insolvency practitioner and the profession into disrepute. Therefore, insolvency practitioners have a duty to recognise the high level of interest the public and the business community have in Pre-packaged sales of businesses by administrators, and to assume there will be greater interest in and scrutiny of such sales where the directors and/or shareholders of the purchasing entity are the same as, or are connected parties of, the insolvent entity. It is equally important that the insolvency practitioner acts and is seen to be acting in the interests of the company’s creditors as a whole and is able to demonstrate this. Requirements in Statement of Insolvency Practice 16 include providing creditors with sufficient information to demonstrate that there has been due regard for creditors’ interests – by way of a narrative explanation and justification of the transaction entered into, within a week of it taking place. These measures were introduced in November 2015 when the Pre-pack pool opened its doors to applications from connected party purchasers, with the potential for independent pool members to provide an assurance to creditors about the Pre-pack deal…so far, so good. Take up in the period to December 2016 was 28 percent of eligible transactions – not a bad start, but there was an expectation that numbers would grow. The problem is that they haven’t. The application numbers have slowed, and at the present rate the total for 2017 could be lower than last year. What does that say about the ‘success’ of this process, which was one of the steps taken by the insolvency profession and business community to implement recommendations made by Teresa Graham in her report on Pre-packs? Does the scheme need to be made compulsory to be effective, do the pool’s doors need to be opened to applications from practitioners, should other connected party transactions be included, or should perhaps pool members review all SIP16 statements to increase coverage? A number of the above options have been considered by the Pre-pack pool oversight group, and some will be discussed by the Joint Insolvency Committee (on which CICM has a seat). A key question might be to what extent creditors pay attention to the SIP16 statements and pool opinions where they are provided, and to what extent are creditors’ decisions on future trading with the new company influenced by a pool member’s report. If there is no discernible difference in creditors’ approach, then what will drive purchasers to pay for an opinion which is little read or considered? The Government could outlaw connected party transactions, but would that really be in creditors’ best interests? The need for transparency is well understood, but a connected party will often produce the best price and therefore better prospects for creditors. Perhaps a ban on transactions that haven’t been to the pool is one option to consider, but what if the applicant receives a negative opinion? At the moment, the sale can still proceed. A wider question is whether driving traffic to the pool is necessarily the mostworthy objective. A broader review of the pool and what it can and cannot achieve might be appropriate, and creditors should be consulted on that. In any event, any change to SIP16 would ordinarily be subject to a public consultation, and CICM would no doubt participate in the debate. Some individual CICM members may have strong views on the subject; now is the time to make them heard! The Recognised Standard / www.cicm.com / October 2017 / PAGE 11
Page 1 and 2: CREDIT MANAGEMENT CM OCTOBER 2017
Page 3 and 4: OCTOBER 2017 www.cicm.com CONTENTS
Page 5 and 6: Notall credit collection systems ar
Page 7 and 8: NEWS IN BRIEF It's new visual ident
Page 9: Goldman Sachs to launch new consume
Page 13 and 14: For more information call 01206 322
Page 15 and 16: EDUCATION Visit CICMOS for personal
Page 17 and 18: THE CREDIT CONTROL RECRUITMENT SPEC
Page 19 and 20: VIEW FROM THE SEA FRONT AUTHOR - DA
Page 21 and 22: OURAML SOLUTION WILL HELPYOU SEAL T
Page 23 and 24: THE RECOGNISED STANDARD CICM Britis
Page 25 and 26: w HQ PROFILE - MEMBER ENGAGEMENT Su
Page 27 and 28: TRADE TALK The importance of Free T
Page 29 and 30: CURRENCY UK BREXIT GLOOM WE'RE not
Page 31 and 32: Who we are covering 96% of the worl
Page 33 and 34: COUNTRY FOCUS AUTHOR - ADAM BERNSTE
Page 35 and 36: THE B2B DEBT RECOVERY SPECIALISTS T
Page 37 and 38: OPINION AUTHOR - ADAM BERNSTEIN bec
Page 39 and 40: PAYMENT TRENDS Sector Sector Scotla
Page 41 and 42: OPINION Unintentional consequences
Page 43 and 44: LEGAL MATTERS compounded by ten per
Page 45 and 46: OPINION AUTHOR - CHRIS SANDERS that
Page 47 and 48: EDUCATION IN BRIEF: ABB is a pionee
Page 49 and 50: THE CICM MAGAZINE FOR CONSUMER AND
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