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WHAT’S IN STORE FOR CORPORATE TRAVEL PAYMENTS?

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WHAT’S IN STORE FOR CORPORATE TRAVEL PAYMENTS?

Simon Barker, CEO and Founder of leading virtual card technology provider, Conferma, explores what 2017 has in store for business travel payments

 We can be certain that uncertainty is here to stay

2017 will stand out as a year of significant change for corporate travel. The biggest challenges facing business over the next year will spring from dealing with more uncertainty.  Over the last 6 months, it has become even more evident that we are not good at predicting the changes that are afoot. 

Successful business will become even more agile and fleet of foot. The ability to anticipate and roll with the implications of change has to become part of businesses’ DNA. Uncertainty in political, economic and technological landscapes should all be treated with the same dexterity of thought, after all ambiguity can provide opportunity for those who are quickest to adapt.

As we move forwards in an ever changing payments world with global actors and start-ups attempting to define new standards, we can be sure of nothing.  All we can do is to make sure that our people, technology and infrastructure is adaptable to a highly dynamic market place.

We can be certain that uncertainty is here to stay, and so are we if we focus on adding even greater value for our customers and partners.

Opportunities to grow and to innovate will spring from uncertain footing, but businesses must be quick and efficient in providing business travellers with the same level of convenience they already enjoy in their personal lives.

  1. Mobile will lead the consumerization of business travel

Mobile has changed the status quo. Holidaymakers are accustomed to using their mobile phones to check in to their hotel room, make payment, check out and manage their entire trip. We don’t plan our journeys without our smartphones and we don’t travel without them either.

Moreover, consumers are quickly recognising that, to make payment, you don’t need plastic or cash. An ever-increasing number of consumers use their contactless card, mobile phone, fitbit, or virtual card as a convenient way to pay. 

The uptake in contactless and non-plastic transactions, electronic and mobile wallets is growing, and this trend will undoubtedly continue in 2017 at an accelerated rate. In fact, mobile payments are predicted to account for $1 trillion USD in value in 2017.[1]

Mobile adoption grew, particularly in emerging markets, and global smartphone traffic is predicted to exceed PC traffic by 2020.[2]Mobile payment has grown in popularity, and monthly active users of Apple Pay were up more than 450% year-on-year in June 2016. Research has predicted that total mobile payment volumes will climb up to $1.08 Trillion by 2019.[3]

The same customers have, as yet, been unable to replicate that convenience when travelling for business, but soon it will translate for business. There is plenty of room in the market for movers and shakers in virtual payments to service the business traveller and TMC, and as consumers grow more accustomed to convenience, they should act fast.

  1. More millennials are on the move

The boardroom is changing. A generation of workers born between 1980 and 1995 have become of age to make high level decisions, drive business development and of course, take business trips.

Microsoft and Apple, for example, employ a host of bright young minds, but growing up in the age of digitalisation and automation has left them frustrated with manual and one-size-fits-all processes for corporate travel booking. 

For these digital natives, accustomed to seamless mobile integration with an enhanced user experience, paper-based inefficiency is unexpected and quite jarring. This is an important demographic to please, considering millennials took 7.4 business trips in the last year. In comparison, Gen Xers took 6.4 and baby boomers 6.3.[4] Even so, only 28% of corporate travel solutions enable bookings via mobile devices, with just a further 5% intending to offer in the next 12 months.[5]

The corporate space hasn’t caught up to the level of automation and customisation that millennial business travellers are accustomed to in their personal lives. To remain relevant among young executives in 2017, the key will be to simplify and automate paper-based processes, manual check-in and time intensive expense claim policies.

[1] IDC https://www.idc.com/getdoc.jsp?containerId=prSG25845515

[2] Cisco, June 2016

[3]Trendforce, 2016

[4]https://skift.com/2016/10/27/millennials-are-now-the-most-frequent-business-travelers/

[5]http://www.amadeus.com/web/amadeus/en_GB-GB/Amadeus-Home/News-and-events/News/Generation-Y-business-community-says-travel-is-essential/1319477347482-Page-AMAD_DetailPpal?assetid=1319610389476&assettype=PressRelease_C

Business

Sunak to raise business tax to pay for COVID-19 support – The Sunday Times

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Sunak to raise business tax to pay for COVID-19 support - The Sunday Times 1

(Reuters) – British finance minister Rishi Sunak is set to increase a tax on business to pay for an extension to COVID-19 support schemes in the budget next month, The Sunday Times reported https://bit.ly/3ujaBcU.

Sunak, in his speech on March 3, will announce he is increasing corporation tax from 19 pence in the pound and will outline a pathway where it rises to 23 pence in the pound by the time of the next general election, the report said. The move will raise an expected 12 billion pounds ($16.8 billion) a year, the report added.

According to the report, at least 1 pence is set to be added to the bill for business from this autumn, at a cost to business of 3 billion pounds, with further rises in subsequent years.

Allies of Sunak clarified he would not increase corporation tax higher than 23%.

These measures will be helpful in paying for an extension to the furlough scheme, VAT cuts and business support loans until at least August.

Unlike the 2010 Conservative-led government, which pursued spending cuts to rebalance the economy after the global financial crisis, Sunak is expected to defer most of the toughest decisions about how to pay for that support in his budget speech.

“The corporation tax hike will be higher than expected and the extension of the support schemes will be longer than most people expect,” the newspaper quoted a source as saying.

Insiders indicated the stamp duty holiday on property purchases would also be extended in line with the other coronavirus support measures, the report said.

Britain’s economy had its biggest slump in 300 years in 2020, when it contracted by 10%, and will shrink by 4% in the first three months of 2021, the Bank of England predicts.

($1 = 0.7136 pounds)

 

(Reporting by Vishal Vivek in Bengaluru; Editing by Lincoln Feast.)

 

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Foxconn chairman says expects “limited impact” from chip shortage on clients

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Foxconn chairman says expects "limited impact" from chip shortage on clients 2

TAIPEI (Reuters) – The chairman of Apple Inc supplier Foxconn said on Saturday he expects his company and its clients will face only “limited impact” from a chip shortage that has rattled the global automotive and semiconductor industries.

“Since most of the customers we serve are large customers, they all have proper precautionary planning,” said Liu Young-way, chairman of the manufacturing conglomerate formally known as Hon Hai Precision Industry Co Ltd

“Therefore, the impact on these large customers is there, but limited,” he told reporters.

Liu said he expected the company to do well in the first half of 2021, “especially as the pandemic is easing and demand is still being sustained.”

The global spread of COVID-19 has increased demand for laptops, gaming consoles, and other electronics. This caused chip manufacturers to reallocate capacity away from the automotive sector, which was expecting a steep downturn.

Now, car manufacturers such as Volkswagen AG, General Motors Co and Ford Motor Co have cut output as chip capacity has shrunk.

Counterpoint Research says the shortage has extended to the smartphone sector, with application processors, display driver chips, and power management chips all facing a crunch.

However, the research firm predicts Apple will face a minimal impact, due to its large size and its suppliers’ tendency to prioritise it. Apple is Foxconn’s largest customer.

Foxconn is looking at other areas for growth, including in electric vehicles (EVs), and Liu said their EV development platform MIH now had 736 partner companies participating.

He expected it would have two or three models to show by the fourth quarter, though did not expect EVs to make an obvious contribution to company earnings until 2023.

Liu also said the company was still looking for semiconductor fab purchase opportunities in Southeast Asia after not winning a bid to take over a stake in Malaysia-based 8-inch foundry house Silterra.

(Reporting by Ben Blanchard and Jeanny Kao; Writing by Josh Horwitz; Editing by William Mallard and Ana Nicolaci da Costa)

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EU seeks alliance with U.S. on climate change, tech rules

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EU seeks alliance with U.S. on climate change, tech rules 3

By Sabine Siebold and Kate Abnett

BERLIN (Reuters) – Europe and the United States should join forces in the fight against climate change and agree on a new framework for the digital market, limiting the power of big tech companies, European Union chief executive Ursula von der Leyen said.

“I am sure: A shared transatlantic commitment to a net-zero emissions pathway by 2050 would make climate neutrality a new global benchmark,” the president of the European Commission said in a speech at the virtual Munich Security Conference on Friday.

“Together, we could create a digital economy rulebook that is valid worldwide: a set of rules based on our values, human rights and pluralism, inclusion and the protection of privacy.”

The EU has pledged to cut its net greenhouse gas emissions to zero by 2050, while President Joe Biden has committed the United States to become a “net zero economy” by 2050.

Scientists say the world must reach net zero emissions by 2050 to limit global temperature increases to 1.5 degrees above pre-industrial times and avert the most catastrophic impacts of climate change.

The hope is that a transatlantic alliance could help persuade large emitters who have yet to commit to this timeline – including China, which is aiming for carbon neutrality by 2060, and India.

“The United States is our natural partner for global leadership on climate change,” von der Leyen said.

She called the Jan. 6 storming of the U.S. Capitol a turning point for the discussion on the impact social media has on democracies.

“Of course, imposing democratic limits on the uncontrolled power of big tech companies alone will not stop political violence,” von der Leyen said. “But it is an important step.”

She was referring to a draft set of rules unveiled in December which aims to rein in tech companies that control troves of data and online platforms relied on by thousands of companies and millions of Europeans for work and social interactions.

They show the European Commission’s frustration with its antitrust cases against the tech giants, notably Alphabet Inc’s Google, which critics say have not addressed the problem.

But they also risk inflaming tensions with Washington, already irked by Brussels’ attempts to tax U.S. tech firms more.

Von der Leyen said Facebook’s decision on a news blackout on Thursday in response to a forthcoming Australian law requiring it and Google to share revenue from news underscored the importance of a global approach to dealing with tech giants.

(Additional reporting by Foo Yun Chee; editing by Robin Emmott and Nick Macfie; editing by Jonathan Oatis)

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