Associate Director; Fund Structuring | ACA M&A Tax

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In June 2019, Huw van Steenis - Group Managing Director at UBS and a credible figure in the banking and finance world, chaired the Future of Finance Report, conducted on behalf of the Governor of the Bank of England to review the UK’s financial system and what this meant for the Bank’s agenda over the coming decade. In this report, one of Huw van’s recommendations for the bank was: To enhance the payments system for the digital age as this is a force shaping the economy as we know it. " In the Fintech boom, companies and cloud based systems are becoming ever more respected in the banking & capital markets space - you don’t have to look too far to see a new digital payment or trading app popping up offering even quicker and easier payment transfers, online banking and currency converting.A major switch in how the public perceive technology is something that forced the hand of even the ever cautious consumer, long gone are the days of apps or cloud based systems being perceived as risky when uploading your most important information, including your banking details. The now slick and smooth process of setting up a new bank account via an app like Monzo, or setting up a new staggered payment process via Klarna can be done within minutes.In a digital age, cash in its conventional sense seemingly inhibits the consumer and some believe it becomes a problem that they never knew they had, as loose change and heavy pockets are an inconvenience we don’t have to live with. Huw van discovered that in Sweden, cash payments had fallen by 80% over the past decade and experts believe that the UK is only four to six years behind.Ten years ago cash was used for six out of ten payments and experts believe that this will inevitably drop to one in ten payments in ten years’ time, as you can imagine cash has been taken over by debit cards and contactless technology that is only bound to increase over time.As of 2018, cash accounted for 28% of payment methods used, this is down from 60% in 2008, so it is obvious to see the use of cash is on the decline heading towards the experts predictions of 9% by 2028, but has Covid-19 sped things up pushing us five to ten years ahead of schedule in reducing the use of cash?Banks and retailers have been pushing the use of contactless payments and online services for hygiene reasons and as shops started to close, the UK cash usage halved within days. Reports also show that during lockdown ATM transactions were down by 60%, a rapid drop compared to the year on year decline of roughly 6% - 10%. This all happened despite the World Health Organisation never actually instructing people to avoid cash during the pandemic.In some cases retailers have been refusing to take cash, I know this from personal experience, maybe you have experienced this too? So what chance does cash have to survive?Over the past few years with the emergence of the Fintech space in London, we began growing our offering for clients of this type. We recognise the need to be flexible and dynamic to match the world of Fintech and are proud to support such disruptive businesses. With our financial services expertise and tenure, we've found ourselves to be excellent commercial partners and providers for Fintech firms that are both in a period of rapid growth and those that have made their mark on the market. View our latest roles here. 

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While mergers and acquisitions were once a strategy for companies to extend their global footprint, or grow their workforce, technology has shifted the focus. Firms are now motivated to acquire technology companies and assert their dominance in the digital sphere. Businesses might currently be facing a great deal of economic uncertainty, but there are still plenty of deals on the table, and in the first two months of H2 2020, global M&A megadeals totalled $256 billion. No matter whether the intentions of a business scale-up are to drive innovation, or to ensure competitive advantage, technology will continue to take a leading role in future deals. Here’s why technology is an essential piece of the puzzle and how it has inspired the new wave of M&A deals: Future-proofingSome job markets - like professional services - have faced fewer hurdles since the virus outbreak but they still face the pressure to remain relevant and to future-proof their services. Businesses are acquiring to stay in the game and become recognised as trailblazers, rather than chasing the competition’s tail, and M&A deals are motivated by the need to acquire new services, processes, talent or technology. Technology has the power to future-proof a business because it accelerates digital transformation; as companies try to navigate the uncertainty that is ahead, M&As will shift from being a future-proofing approach to a crisis-proofing strategy, and technology will likely play an increasingly central role. The booming cloud services marketNot long ago, AI was considered a futurist technology and conversations centred around whether robotics were a threat to jobs – even to those in the tech industry. However, research has proven how machine learning has the capacity to create more jobs and enable workforces to become more specialised. Within the same family of ‘disruptive technology’ is cloud computing. The global cloud services market is expected to hit a value of $331.2 billion by 2022, and today there are very few businesses which don’t use cloud computing models such as SaaS. This has created a flurry of activity on the M&A scene as corporations rush to snap up businesses who have the expertise and equipment they need to take their operations entirely remote. What’s more, cloud computing is built on the idea of scalability, making it an essential piece of the M&A puzzle. Research has proven how machine learning has the capacity to create more jobs and enable workforces to become more specialised. " FintechM&A deals rely heavily on face-to-face interaction, so it is no surprise that there was a 44.7% drop in the value of transactions in H1 2020 when compared to the previous year. However, in spite of the restrictions and economic uncertainty, Mastercard announced the acquisition of Finicity for $825 million in June. The fintech company specialises in open banking – a business model that gives third-party companies secure access to customers’ banking details, thereby allowing customers to have greater control over their finances and how they budget. Open banking has helped to bring financial services into the modern age - one reason why many similar M&A deals are appearing in the wake of Covid-19. 2019 was hailed the year of fintech M&As, bringing in four megadeals and a total deal value of $121.18 billion in H1 alone. Yet, 2020 has proved to be a promising year and the surge in the acquisition of fintech firms can also be attributed to the need for companies to provide a wider range of multichannel services. Markets are converging and this mounting interest in technology-enabled banking services has stirred up the M&A market where high profile fintech deals will likely go on to break more records. A career in M&AProfessionals working in M&A are in the business of creating value. While some companies will have been forced into survival mode, for others, the pandemic has exposed an opportunity to join forces with emergent start-ups or disruptive corporations. Professionals working in the M&A market are helping these businesses to source and snap up technology companies that will allow them to stay ahead of the curve. As technology continues to infiltrate every industry and discipline, M&A deals will become more widespread and the strategic skills of employees in this field will become more desirable. If you’re ready to take your skills to the market browse our jobs and have a look at our career advice hub. Providing a service that is tailored to youIf you’re interested in partnering with an agency that approaches the recruitment process differently, then Marks Sattin is the choice for you. We have a rich history of providing an unrivalled, relationship-led service to our clients and candidates. Our consultants are committed to connecting businesses of all sizes – from global organisations, to emerging start-ups - with talented professionals. Contact us if you’re looking for more information on recruitment solutions in M&A, financial services, corporate development or investment & advisory.