Month: November 2020

The COVID-19 pandemic has thrown unprecedented challenges at the business world, meaning companies have had to deal with the unforeseen and the unknown. During nearly a year of incredible difficulty, uncertainty, and abrupt disruptions, businesses have had to pass through many unpleasant phases. However, 2020 has also provided many lessons and paved new paths. What’s in store for enterprises in the coming year is a matter of speculation, with experts divided in many regards.

Despite the uncertainties, it is possible to make predictions about what we may expect to see next year, at least to the best of our knowledge. Here are six predictions for businesses for 2021 so you can start planning for the year to come.

Business Won’t be Back to Normal Until the Second Half of the Year

Experts stand divided on the question of when everything will get back to normal: there is a broad spectrum of predictions on the matter. Half of the CFOs in major UK companies believe that business-enterprises will return to the pre-pandemic levels only in the second half of 2021. However, others believe that business may get back on track in the first part of the year. And there is a worst-case prediction too that hardships could even last as far as 2024. All we can do is wait to see how everything turns out, as it is hard to make concrete predictions in these times of rapid fluctuations and many unknowns.

Commerce Going Digital for Survival

The pandemic that cut down offline interactions drastically has meant businesses have had to depend on online and digital technologies more than ever. Whether it is for communication, sales, or payments systems, many companies that previously only made a minimal use of modern technologies started incorporating more technological solutions. The trend is here to stay and will become a significant deciding factor of business success in 2021. Most businesses already have an established digital presence through multiple channels including websites, apps, and social media to engage with their customers.

The COVID Vaccine Will Boost Sales

The anticipated vaccine rollout of the COVID vaccine will give a fresh hope to business in 2021. Almost all sectors will see increased activity, with healthcare, hospitality, and transport expected to flourish in particular. The vaccine will be the single most important reason for many businesses that have been in a hiatus for a while to spring back to work. Though issues with regulations, production, and distribution of the vaccine are still uncertain in a number of ways, experts look forward to it as a highly decisive factor for the recovery of businesses from their pandemic-induced slump.

The Customer Will Have to be Studied Anew

The Pandemic has made a drastic shift in consumer behaviour. There is a wide gap between pre-COVID and the post-COVID customer views in terms of their approach to prices and quality levels, the ability to shop digitally, and the kind of products they prefer. A significant proportion of consumers used digital financial services, including internet banking for the first time during the pandemic. Whatever businesses had learned about their customers will have to be relearned in 2021. It will have a considerable impact on how organisations conduct their affairs, plan strategies and advertise products.

UK Unemployment will Rise

The pandemic has rendered many people jobless. Last year, unemployment in the UK was 1.3 million. And predictions are that it will rise to somewhere between 1.9 million and 4 million in 2021. Much of the turbulence currently witnessed in the job market will carry over to 2021. Though the current unemployment rate of 4.8% according to the BBC is comparatively less than during the 2008 financial crisis, it unfortunately looks like it is set to rise in the future.

The Need for a Dedicated Budget for Cybersecurity

The coming year will demand cybersecurity to be a key consideration in any company’s budget. As more and more businesses go digital, the threats from the cyber world increase, such as phishing, ransom ware and hacking. Since many establishments have switched a considerable amount of operations to online only due to the COVID crisis, they may not be fully aware of the hidden threats and thus could be in a highly vulnerable.

For cybercriminals COVID-19 is an excellent opportunity to exploit newly established networks of small and medium companies. Cybercrime has increased more than ever during the pandemic, so companies that have moved online will need to step up their cybersecurity efforts (and budget) in 2021.

Key Takeaways

Since the start of the COVID-19 pandemic, things have been changing and taking new turns from month to month. Therefore, we cannot rely on any prediction as a surety. Factors like delays in the vaccine distribution due to regulation issues or complications with its production, and many other uncertainties could mean that more surprises are around the corner. Nevertheless, taking expert predictions into considerations, while being prepared for things to change, is the best way for businesses to set themselves up for success in 2021.

As you begin to grow and diversify your investment portfolio, there are some key things you need to know about Guaranteed Investment Certificates (GICs). Make sure that you do your research well before investing—this way you will be sure that you are investing in the right type of products and that you will be able to get more benefits for your investment. It is better to be safe than sorry.

GIC Overview

You are probably wondering, ‘what is a GIC?’ GICs are certificates are issued by Canadian financial institutions that are typically issued without any conditions in return for a set of investment documents that can be used as security for the loaned funds. These certificates can be flexible, and come with numerous terms and conditions that vary from institution to institution.

So, What’s the Catch?

When you deposit the money, it must be for a fixed length of time, and interest rates can vary according to the length of the commitment. Purchasing a GIC is lending the bank your money and making interest off of the money for lending it to them. Be aware if you take the money out before the term is up, there is a penalty.

Financial institutions that offer them are legally obligated to pay the principal and interest. And if the bank were to fail, the investor is insured by the Canadian Deposit Insurance Corporation (CDIC) for up to $100,000 CAD.

What do I Need to Get a GIC?

First of all, you need to know that you need to have a certain minimum percentage of asset value as collateral. The higher the risk, the higher the interest rate. So, you need to think carefully when choosing a GIC and make sure that you understand the terms and conditions. Also, in most instances, the interest rate charged will vary on how risky the investment might be. A GIC is typically a safe and smart investment for people who are looking for an additional income stream.

Are GICs Tied to the Stock Market?

There are GICs available that are tied to the stock exchange. These can offer low risk for a high return and are offered through a broker who sells stocks to you through your brokerage account.  Using a broker could allow transparency with the exchange you are trading, since you know who you are dealing with as well as the type of stocks you will be purchasing. However, before you do this, you should do your research. By doing a bit of due diligence, you will be able to make sure you are getting yourself the best deal for your money.

Fixed vs. Variable: What Interests You?

A fixed interest GIC is issued to an individual at a fixed rate over a specific amount of time, usually for a short period of time. These types of policies are generally offered as retirement annuities by banks and financial institutions. You earn a certain percentage on the funds you deposit. When purchasing a fixed GIC, you are basically taking a loan out from the bank to pay the premiums over the duration of the policy. If you don’t have enough money to pay the premiums, you are unable to sell the policy or receive a refund.

Variable GICs, on the other hand, are issued as a variable annuity at an interest rate that varies from month to month. You have the choice to adjust the interest rate—however, you are not legally obligated to do so. This is done because it costs the bank more money to purchase the insurance in a fixed rate policy over a variable rate. If you opt to purchase a variable GIC, you will be charged additional interest based on your initial interest rate. If you change your interest rate at the end of the month, the extra interest will be applied to the remaining balance of your loan. If you choose to purchase a fixed GIC, you have the option to adjust the interest rate and there is no additional interest charged if you change the rate. This option, however, is not available with the variable GIC.

Where do I Get a GIC?

When searching for a fixed GIC, you can search online for the different companies that offer them or look through a local newspaper. While there are many different companies offering this type of insurance, it is important to make sure that the firm is licensed to sell them. You should also read all the fine print on the company’s website and make sure that it is accurate. Some companies are less than honest about the benefits and conditions associated with their policies, so make sure you do your homework.