Paul Hunt, Managing director, Phoebus Software
You’ve recently got involved with Kiva – can you explain in a nutshell what Kiva does?
Kiva is a conglomerate that allows you to lend money to poorer individuals who wouldn’t normally have access to funding. It’s a multinational charity.
People who need money for businesses in poorer countries can go online and ask to borrow a certain amount. This request is submitted to potential lenders that can volunteer to lend all or some of the amount requested. A rate of interest is attributed to the loan and the funds are given to the borrower. The interest rate is lower than on typical loans.
Why did Phoebus choose to get involved?
We wanted to help the charity. We support a lot of other charities too. For example, in June we will be taking part in the Hope Challenge with Habitat for Community, which helps raise money to provide shelter for people in poorer countries.
The event takes place in the Peak District. Teams have to build their own shelters and trek 20 miles. All the money from fund-raising goes towards the cause. With Kiva, we may get the money repaid but we’re looking at it as a charitable donation rather than a loan.
How important will software be in 2010?
In terms of lenders, it’s important and this is driven by the Financial Services Authority. The regulator requires all banks to have software in place. It’s hard to believe, but some smaller lenders still do not have the required software. From a Treating Customers Fairly point of view, software is vital. The main benefit of technology is the efficiency of processes it provides. It is an effective way of reducing costs.
Where do you see the market going this year?
I wish we didn’t have the general election this year as it will slow everything down. The focus is now political rather than how we can get the economy back on track.
I think house prices will be stable. I’m not sure what will happen in terms of the FSA and the Bank of England.
With lending, I think we’ll see peaks and troughs. There’ll be quite a few new lenders entering the market, but I think 2011 will be the turning point in terms of a recovery.
Interview by Christine Toner