From on ro-ar.com

This week seemed a week of reflection. Attending a few of webinars it seems a few of us were in the same mode too.

The spurt of activity post-Christmas seems to have waned, investment-ready, but the button to start is not being pressed.

It is busy busy rather than delivery busy.

Economically it is becoming increasingly evident a pent-up demand for spending and for lending is building. Some consumers are revving their shopping engines, ready to go, just waiting for the brakes to be released.

This of course could somewhat be behind any pause in collections-related investment activity. Financial services businesses could simply be directing funding elsewhere in anticipation of generating growth.

Of course, as discussed last week, we are not out of the woods yet. There is still a substantial proportion of society on furlough and the very real risk of rising unemployment.

This was further highlighted, this week, in the government report on the scheme. It also contained a very illustrative graphic, detailing just how numbers rose, fell and are now on the rise again. What is also worth noting is that this time the numbers are rising at exactly the same time the unemployment rate is increasing too. Something we have not seen to date, so really does seem different this time too.

Lastly, as if to illustrate the point, a study from Ofcom this week showing that 4.7million customers struggled with their Telco bill over the last year too.

Even though lockdowns are starting to relax and things are feeling more optimistic, we need to continue investment and process preparation. Remaining vigilant and focused on spotting is clearly going to remain important.

A couple of other stories this week too

• Millions of UK bank customers miss out on security checks – also against a background of increased fraud activity during lockdown
• UK office workers would give up promotions, benefits and pay increases to work from home – more desire for working from home continues
• Nationwide tells 13,000 staff to ‘work anywhere’ – seems like Nationwide are already moving in this direction
• Mind the gaps: will we go back to public transport after Covid? – with public transport struggling as a result?
• Half of British workers had real-terms pay cut in 2020, study says – however will this also have long-term impacts on pay structure too?

Have a good weekend everyone…

From on ro-ar.com

What is up in the second charge mortgage and car finance market?

New figures from the FLA this week show new business fell by 40% YOY in January and t was a similar situation in the consumer car finance market, 35% down. Even in mortgages more generally, households seem to be paying down by record amounts too.

With the pandemic situation now passing a year, it really does appears as if this latest lockdown has been different. It has certainly felt different, but now the data is showing how were are normalizing this more and more.

A good example is car sales. In the first lockdown, sales were up. We all seemed to need cars to avoid public transport. Many people also took advantage of stamp duty holidays, moving out of the city partly to avoid COVID, driving the property market too.

This time around on lockdown, there is less need for change. In fact, for many, it clearly seems a good opportunity to pay down debt.

However, government economic support is also starting to recede. What about those who are more impacted and find themselves at risk of financial difficulty? We seem to hear less about this recently too.

Employment in fact has started to tickup (currently 5.1%), albeit less than previous peaks in the last financial crisis, the 80’s and 90’s.

With 4.7million people still on furlough support in the UK, you wonder how much this support is helping with these figures. Without furlough another 7+% could quickly be added to the unemployment rate, taking it to historic highs. (Indeed the unemployment rate does appear to have trended up the last few months).

With the furlough scheme now extended until July and September, we still have some time, and hopefully the economy will roar back to life as quickly as lockdown started.

However, I cannot shake a sense of us seemingly slowly, having to pick our way through an increasingly dense iceberg field in the fog. Silent but dangerous, all may seem quiet but still time to prepare and get ready.

Other stories of interest this week

• The right to disconnect – a reaction to more remote working
• The four day working week – being discussed in Spain
• Bitcoin under pressure? – could be banned in India

Have a good week everyone.