ClearBank: The global banking landscape and supporting SMEs
FinTech Magazine catches up with ClearBank CEO Charles McManus at Money20/20 Europe to discuss the current fragilities and uncertainties in the global banking industry, why it is critical to support SMEs in different markets, and why events such as Money20/20 are great for fostering partnerships across the broad spectrum of financial services.
Touching on the potential of a global banking crisis, McManus says: “There are two things that kill banks; one is liquidity, or absence of it, as those people queuing outside Northern Rock branches to get their cash out in 2007 know about all too well.
“And the other, of course, is losses and credit. If you don't get those two right, a bank will end up in trouble, which is what we’re seeing today with SVB and First Republic.”
The current economic crisis is why McManus feels now is the time we should be supporting SMEs to boost the economy. He adds: “Inflation is far too high. Interest rates have got to go higher to keep pace. Though caused by the headwinds of surviving COVID-19 and everything else happening politically, it may be that this leads us to having to survive again should we enter a recession.
“Look at inflation rates and the cost base in relation to SMEs and spending being squeezed, and then add on to it all of the friction in relation to Europe and, and exporting goods. The challenges are everywhere if you’re trying to merely survive as a business.”
For more from McManus, see the video above, click on this link, or check out the Fintech Magazine LinkedIn page.
