UK Finance News

For many of us the festive season is a time for over indulgence, be it over eating or drinking or over spending on presents for our families and loved ones. It is often our credit cards that take the brunt of the cost for the season and nothing brings on the January blues quite like the credit card bill hitting the doormat.

Now is the time that many will be looking to transfer their debt from one credit card to another, to take away the pain of having to pay excessive interest on their credit card account.

While there are plenty of credit card comparison sites on the internet, choosing a new deal is by no means a simple choice. Despite our pleas for plain speaking and easy to understand terms, the credit card market still represents a minefield for those looking to transfer outstanding balances.

It is therefore very important to take stock of personal finances and ability to pay off the outstanding balance before making a switch to another provider, bearing in mind that if you cannot repay the balance during the interest free period, interest on the balance will be charged at the standard rate.

One of the best credit card deals around at present is the MBNA Platinum card, which charges an interest rate of 5.9% throughout the life of the outstanding balance, so even if it takes ten years to pay off, the interest will remain at 5.9%. This would represent a far better deal than many of the zero percent transfers on offer if you are unlikely to be able to pay off the card balance in a restricted time frame.

This comes out favourably against many of the providers offering, say 0% on transfer balances for 15 or 16 months and then reverting to standard rates.

These deals are not restricted to personal credit cards, as there are also similar offerings for professionals looking for a business credit card that offers a great deal along with greater online protection and chip and pin security on the high street.

The end is nigh for the humble bank cheque, after more than three hundred years as the payment of choice for many, banks are expected to vote to phase it out in favour of more up to date payment methods.

During the last  forty years credit and debit cards have taken over from bank cheques for payment, while Standing Orders, Direct Debits and BACS payment systems have emerged as direct payment methods.

In the internet age, technology is such that most of us are able to conduct our banking online from anywhere in the world, with instant transfers from one account to another at no cost.

Surprisingly over 3.8 million cheques were written out each day last year in the UK, although that is a far cry from its peak of popularity in 1990 when almost 11 million cheques were issued.

finance minister christine legarde

France are to follow the lead outlined by the UK government in Alistair Darling’s recent pre-budget speech and introduce a special one off tax on banker’s bonuses for 2010.

French Finance minister Christine Legarde has said that a bill will be put before the French parliament in January that will commit tax bonus payments of over 27,000 euros, to fifty percent taxation.

The French government had indicated last week that a similar tax to that announced by the UK would be announced, but no further details were available at that time.

Germany’s Chancellor Angel Merkel has said that she is sympathetic to the idea but fears that it may be against German law.

The UK’s Furness and Harpenden building societies have announced that they have signed up to compete for savers’ cash with Europe’s first and largest online interest rate auction house for time deposits, licuro.com.They make up seven UK societies that have signed up to the scheme that offers large lump sum investors the best time deposit rates available.

Licuro.com is a totally independent market place designed to bring together, on the one hand, UK savers looking for the highest interest rates for their time deposits and on the other hand banks and financial institutions looking to access alternative sources of funding and gain new customers.

A time deposit is an amount of money that you deposit in a deposit taker for an agreed period of time. For this the deposit taker pays you a certain time deposit interest rate. Licuro provides you with a quick and accurate overview of where you receive the best interest rate.

For instance, if you have say £50,000 to invest for three months, you can put your funds up for auction and recieve interest rate bids from some of the UK and Denmark’s most competetive financial institutions. With just a few clicks you will be able to find the best interest rate in the market for your deposit.

Since July, Licuro.com has processed over £20 million in the UK and two sister sites will be launched in Luxembourg and Belgium in February 2010 with Germany to follow in March 2010.  It is expected that these new sites will see a rapid increase in traffic over the next 12 months.  The original site in Denmark, mybanker.biz, founded in 2002, has processed the equivalent £1.4 billion in the last twelve months.

John Norden, CEO of Licuro.com in the UK and founder of mybanker.biz inDenmark says:

“We are delighted to see Licuro gaining momentum in the UK. We’ve a proven model in Denmark, which has translated very well to the UK although it is still very early days, and with the roll out elsewhere in Europe UK will in the long run give savers the option of depositing with banks in other European countries, with the obvious foreign exchange advantages.

From the savers’ perspective, Licuro is the site to go to if you have, say, £25,000 to invest (although the minimum accepted, which is set by deposit takers themselves, is currently £12,000 with no maximum). We offer savers a totally transparent way of depositing their money at an interest rate that is pushed up by the competition created by the several building societies, each with their own distinct liquidity requirements, bidding for their cash online in real-time.”

Despite their differences of opinion on financial regulation, British PM Gordon Brown and French President Nicolas Sarkozy have united in an article published in the Wall Street Journal today, calling for a level playing field for taxing bonuses and restricting pay across the world.

In what is seen as an open attempt to lure US President Barrack Obama on board, the article says;

“This crisis has made us recognise that we are now in an economy which is no longer national but global, so financial standards must also be global. We must ensure that through proper regulation, the financial sector operates on a level playing field globally.”

Calling for a ‘new compact between global banks and the society they serve’, Brown and Sarkozy said;

“We agree that a one-off tax in relation to bonuses should be considered a priority, due to the fact that bonuses for 2009 have arisen partly because of government support for the banking system. However, it is clear the action that must be taken must be at a global level. No one territory can be expected to or be able to act on its own. And if we can find a solution, implemented consistently across the major economies, then we may find a way to ensure that taxpayers do not pay for the risks taken by the banking sector.”

In the US a poll has revealed that 75% of the public believe that none of the US banks that recieved state aid should even consider paying bonuses this year.