Moving on and moving on up…

Two weeks into the year and a couple of themes are already emerging.

Complexities: Rising complexities with trade, increased COVID levels, with new variants, is all leading to a real sense of unease on the economy and going forward more generally.

Different but the same: Back at the start of last year, all of this was new and everything felt unusual. However, this time around it has changed. Although the news is not great, we are now normalising it and are moving on. A sense of a can-do attitude maybe, the will to move on and move ahead.

I not would say there is a sense of optimism, there is not.

However, there is a desire to make the best of it and to move ahead… I suspect this may set the tone for the year.

With all of this in mind there were a couple of stories that caught my attention this week.

  • All eyes on stamp duty, the impact on house prices and lending. I suspect this will get extended. It is probably creating some price inflation for now and may pop any market exuberance if not.
  • 66% of bank customers still don’t trust online. This figure surprised me as it was so high. It does however illustrate a problem for those banks that need to provide a universal service for everyone. Even with lockdown and the great migration to digital, the journey to create new digital habits is still important.
  • Digital processes for back end collections processes have been agreed. Zoom is now allowed to be used for enforcement visits. COVID is accelerating modern ways of working in many areas.
  • Buy-now-pay-later. More pressure for greater regulation on this sector. There are concerns as to whether this could be building up problem borrowing for some consumers and it is all starting to sound very familiar. Porting ideas and experience from other sectors in financial services will no doubt be invaluable here.
  • The importance of psychology in user experience. There is quite a bit of progress in using techniques to drive positive outcomes for customers. This can be in terms of behavior science (nudge) or thinking in the customer’s shoes, it is all very interesting to see this flow through.
  • Lastly, I had a very interesting conversation on simultaneous equations! Not that these are particularly fascinating, but what was interesting was whether we know the equations we are actually solving for (ie. the business problems). These solutions may be different for different parties and how to navigate this is the challenge we all face.

Is it undoubtedly going to be an interesting year…. have a good weekend all.

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Double humpf day

What a crazy week that was. Not only were we back to work, but also whisked off into another lockdown, schools off, homeschooling, COVID cases rising and then towards the end of the week – a late night watching developments in the USA.

All quite unexpected, unsettling, and sprinkled with clouds of doom and gloom; it felt like we were dodging this all week, just trying to be cheerful.

There were of course, still some observations.

  • Getting back to work after the holidays is always tough. This year especially so, with a case of brain fog the first few days… hopefully, plenty of sunny spells with only the odd cloud this week!
  • It has also been a bit of pitiful performance on dry January this year… only 5 days… I am even still eating mince pies (they needed finishing – my excuse!). This coming week needs to be a fresh start… the opportunity to stay in, get fit, do our best to avoid COVID, and stay healthy.
  • Workwise, on calls last week it did feel that more of us have finally decided to be on video… I think I am now up to three ironed shirts a week now… still drawing a line at wearing a jacket… dark colours and cats just do not mix!

Stay strong, stay safe everyone, have a good week… Chris

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6 months in 5 days – the first week of 2021

It has been quite the first week of the year.

  • Back to work after the holidays
  • A new lockdown, with a spiraling pandemic
  • Brexit/End of the transition period, with a loss of trade freedoms with the EU starting to bite
  • and oh yes, a violent attempt to stop a peaceful hand over of power in Washington DC

With everything going on, more normal news has struggled to get much air time this week. There are however themes for us to consider as we start the new year.

Digital is still dominating headlines and investment. With a further lockdown, this will undoubtedly be further accelerated. Firms continue to press forward in what is increasingly looking like the new normal. Some are already complaining they are being disadvantaged, a sure sign that this is a hot topic and source of competitive advantage.

The upcoming challenge is where on the scale of 100% automated vs purely manual do firms want to sit and where is the human touch needed.

The march of WhatsApp also continues. Over new year it set new records for engagement.

Facebook, who own WhatsApp, are working to gradually monetize the platform. It was announced that Facebook will now have access to more WhatsApp data which is likely part of this wider plan.

For UK customers, WhatsApp data is still reportedly under European region, Facebook data is being moved to the US (an impact from Brexit). All of this could potentially give access to new features, such as facial recognition. Whether it will potentially start to erode some perceptions around privacy on the platform we will see.

The ultimate goal however still feels like it is moving towards an omnichannel platform for the internet. Closed systems environments, capturing all customer interaction data, do seem to be increasingly popular.

The economy still feels like it is sluggish. For consumers not sick, and with a job, more data came out showing they have been paying down debt and moving house.

However, all eyes are now on what happens in the mortgage market the next few months. The stamp duty holiday ends at the end of March 2021, which arguably has driven up housing market activity… it is one we need to watch. The concern, whether the end of support will trigger a pop in what could be a housing bubble.

Globally, it certainly does feel as if the economy in many places continues to run on vapour. With all the stimulus keeping it aloft, at some point it will need to come into land. We need to watch for speed of descent. This will determine, the nature of any crash landing… and with extra headwinds in the UK it does feel like we are in for a bumpy few months.

Have a good weekend everyone… Chris

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