FINANCE
by Anna Bowes , director , Savings Champion
Increase your business savings interest by up to four times
At Savings Champion we are passionate about savings . As one of the UK ’ s leading independent experts on cash-based savings and one of the most quoted in the national press , we provide businesses with unbiased , personalised guidance on how they can earn as much interest as possible on their working capital - on average around four times what they are getting now .
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Businesses are missing out on £ millions a year in interest payments by leaving cash sitting in bank accounts that are paying little or no interest .
According to the latest research from Hampshire Trust Bank , on average , UK SMEs have savings balances of £ 446,000 . Nearly a third of respondents ( 30 %) stated that they intend to increase their savings balances over the next 12 months to help cushion any potential financial bumps in the road , amid nervousness about economic uncertainty . Just 14 % intend to reduce the amount of money they hold in savings , with the majority ( 56 %) looking to maintain their current savings level .
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Whichever way you look at it , that is a significant amount to be held in business savings , so all SMEs could potentially benefit from paying more attention to their savings accounts and returns .
However , many SMEs routinely opt for the savings account offered by their current account provider and as a result are earning little or even no interest at all , missing out on a useful source of income . The research also pointed out that , on average , SMEs hold £ 409,000 in their current account . The key question is – do businesses really need to keep this much here ?
Our advice is to make every pound count , making the most of opportunities
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to save for future growth . Even in this low interest rate environment , there ’ s a lot more that you could make for your business , simply by putting that money into better-paying accounts .
But business owners often have better things to do than worry about the interest they can earn on the cash they hold . That ’ s where we can help . For those who would like to make their cash work harder but simply don ’ t have the time or the expertise , our Cash Advice Service helps businesses maximise the amount of interest they can earn .
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If you would like help with finding a suitable home for your business ’ s reserves or would like to find out more about our Cash Advice Service , contact us on 0800 011 9705 .
For more info : www . savingschampion . co . uk
@ savingschampion
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Businesses are heading towards a cashless , digital society
by Ian Lloyd , partner , Milsted Langdon
At the start of 2018 , it was revealed that for the first time debit card transactions will overtake those made with cash this year .
Driven by advances in technology , such as contactless payments and online bank transfers , businesses ’ relationship with cash is undergoing a fundamental change .
ATM usage peaked several years ago , with more than 2.9 billion transactions taking place in 2012 , falling to 2.7 billion in 2016 , which amounted to £ 6 billion less than in the previous year , while figures from the Bank of England show that the volume of cash in circulation is increasing at its slowest rate in 46 years .
In comparison , figures from UK Finance shows that the number of contactless payments has increased from 17.8 million in March 2014 to 469.6 million in June 2017 , with the value of these transactions increasing from £ 116 million to £ 4.3 billion .
How should businesses prepare ? With such a large volume of transactions , it is essential that businesses of all sizes , including sole traders , consider how they process digital payments .
12 THE BUSINESS EXCHANGE 2018
Research shows that a growing number of consumers will willingly shun a business if it is unable to take payment by card .
This should be all the more worrying for businesses that are unwilling to adapt , as in most cases they will instead choose to use the services or buy products from a business that does have facilities to take digital payments .
With a number of simple and costeffective mobile card reading solutions on the market , it has never been easier for companies to take digital payments .
How does this tie in with the wider world of business ? Businesses are not the only organisations to be tackling the digital revolution head on , in fact , one of the biggest changes in taxation is less than a year away now , as HM Revenue & Customs will introduce Making Tax Digital .
Due to begin on 6 April 2019 , Making Tax Digital ( MTD ) will initially see all businesses over the VAT threshold (£ 85,000 ) report their VAT records on a quarterly basis using HM Revenue & Customs ( HMRC ) compliant software .
This will be followed in subsequent years by quarterly reporting of income and other taxes using a similar system .
The changes to the tax system will require companies to submit their VAT and accounting records four times a year , rather than one , and so they need to ensure they are ready to meet this requirement .
In most cases , businesses may be able to use existing online accountancy packages to report to the Revenue as long as they are MTD-friendly , but many businesses are yet to get to grips with the systems that are required .
illoyd @ milsted-langdon . co . uk 01225 904940
For more info : www . milsted-langdon . co . uk