Strap in for the interest rate rollercoaster

Posted on May 4, 2023

The Bank of England base rate just went up for the 12th time. Team Smarta have some sensible suggestions.

Interest rates in the UK haven’t been this high for 14 years.

In April 2023, the consumer price index inflation rate was almost a full percentage point higher than the Bank of England’s Monetary Policy Committee projected in February. Food and non-alcoholic beverage prices rose by 19.2% in the 12 months to March 2023 - the sharpest increase in more than 45 years, according to the Office for National Statistics.

The Bank of England (BoE) base rate was 3.5% at the end of 2022, and so far in 2023 it's only been going gone one way: up to 4% in February, 4.25% in March, and 4.5% in May 2023.

While other global events such as the Turkey-Syria earthquake, the ongoing conflict between Russia and Ukraine and political turbulence in Sudan may be higher up the news agenda, the UK’s financial struggles remain a sore subject.

The Coronation of King Charles (and an extra Bank Holiday) was a welcome distraction, but the cost of living crisis is still at the front of many people’s minds, with workers across the health service, education and rail network striking in protest at how household incomes cannot cover essential outgoings.

Following the latest announcement from the BoE on 11th May that interest rates have gone up again (the 12th time in a row) here’s an explanation of how we’ve got to where we are, and how to limit the impact for you and your business.

Covid changed everything

Back in August 2018 the UK’s economic outlook was looking quite promising. The BoE raised the base rate from 0.5% to 0.75% - almost the highest rate in the decade since the 2008 crash.

But when COVID arrived, two emergency interest rate cuts slashed the base rate down to 0.35% and then 0.1% in March 2020, and we were back in recession.

Since then, we’ve seen 12 consecutive interest rate increases as the BoE attempts to combat inflation, which is currently above 10%. (The BOE aims for an official target of 2% inflation).

The Bank of England has taken this “aggressive action” in an attempt to reduce inflation, which has been spiralling upwards. It’s been predicted that the Bank of England base rate will rise again to almost 5% by August 2023, and could take 5 years to come back down to pre-recession levels.

Spending cuts and tax rises are expected, and inflation will eventually fall as the BoE shifts its monetary policy focus to promoting economic growth.

Keep your eyes open!

Because mortgage and loan repayments don’t go out of your account, or your pocket, on a daily basis, it’s easier to forget how interest affects your personal financial situation and put off taking action. We grumble about the price of everyday items because we see them all the time, but larger financial commitments in the form of direct debits and standing orders are often out of sight, out of mind.

For entrepreneurs in the early stages of business ownership or workers who have recently gone self-employed, finding financial support for your startup can be make-or-break.

Time is not on your side if you have recently left employment to be your own boss and have yet to find business funding that doesn’t threaten ever-increasing interest.

If the Bank of England does increase its base rate further in the coming months, mortgages and loans will become even more expensive and fixed-rate options could be a safer option for both homeowners and business owners this year.

So, if you’re rushing around looking for a loan and comparing lots of different rates, a Start Up Loan offers a simple solution: borrow between £500 - £25,000 for your business and pay a fixed rate of 6% interest. There are no additional fees and you can take a second loan if your business needs it, up to the end of your fifth year of trading. AND, when you take out a Start Up Loan from Transmit Startups, you’ll benefit from free access to expert advice, business templates and resources for free.

Hold on, we might turn a corner

Rising inflation is persisting. This is what we experience on a daily basis as the cost of essential items, including utilities and the weekly food shop, goes up and up.

As long as inflation keeps going up, the BoE are likely to keep raising interest rates in an attempt to bring it under control. This is understandably terrifying for those with large amounts of borrowing. But the UK’s Monetary Policy Committee make their decisions based on 18 economic indicators, including the unemployment rate. There is always a chance that these factors will combine in a way that allows a reduction in interest rates.

With a fixed-rate loan, you know what you’re in for, and there’ll be no nasty surprises - whatever gets decided by the Monetary Policy Committee at their six-weekly meetings.

If you are worried about further increases in market pricing, borrowing at a fixed rate is an appealing option.

If you’re thinking of starting, or have recently started your own business, your new venture is likely to have some impact on personal finances (hopefully for the better!).

It’s useful to be able to look back at how your spending and borrowing has changed over recent years and do some planning - particularly given the economic situation where the cost of everyday items is going up.

If you apply for a Start Up Loan, or even traditional business finance, your lender will need to look at your financial habits as well.

If you’ve been running your business for a while and noticed your business outgoings creeping up as a result of inflation, it could be time to seek the help of an accountant.

To save you more time searching, we recommend Crunch. With expert help and free accounting software you’ll not only be able to ace your accounts, it’ll become clearer where you need to reign in spending (put a few too many trips to the local coffee shop through your expenses?). They can also take painful paperwork off your plate, like your self-assessment tax return.

If the thought of filing your tax return makes your blood run cold, we’ve got good news.

Smarta’s accountancy partner Crunch has opened up their Self Assessment service to any entrepreneur or small business owner.

GET CRUNCHING

Wanna get off?

In recent years, it’s become more difficult to fix mortgages and other loans, because the rules surrounding affordability tests have been tightened. This has left people stuck on “tracker” products - mortgages and loans which directly follow the base rate. Borrowers who do have the option to switch to a fixed-rate mortgage are hurrying to transfer their debt before the BoE makes its next move.

With a fixed rate loan such as a Start Up Loan, your monthly repayments won’t increase if the BoE base rate rises again next time. They’ll remain the same for the full term of your loan.

Provided you’ve taken the time to create realistic financial forecasts and work out your personal survival budget, you can feel more confident that you’ll be able to comfortably meet your repayments on a fixed-term loan, compared with the unknown future of a variable rate option.

Secured or unsecured loans?

Secure borrowing means that you are borrowing against an asset – this might be a business premises, or even your own house if you are a sole trader or a very small business (sometimes called a micro enterprise). If you fail to keep up with your repayments on a secure loan, that asset (property) could be repossessed. For this reason, although interest rates are typically lower for a secured loan, you're taking more of a personal risk.

With an unsecured loan, the money isn't borrowed against an asset, but is based on your business or personal credit rating. This puts the lender at greater risk, which means they will typically charge you more interest.

“Done right, borrowing money - and demonstrating that you can pay it back on time - increases your borrowing potential and opens up opportunities to access finance which simply aren’t available to those with either no credit history, or a poor one.”

For advice on how to check and improve your credit score before applying for a Startup Loan, take a look at this resource we created for small business owners.

Scream if you want to go faster!

If you’ve already secured a Start Up Loan for your business and have been trading for no more than five years, you may be eligible to top up what you've borrowed.

Like Lauren, who borrowed £15,000 to launch her yoga studio, then topped up her loan with an extra £5,000 when she began offering pilates and barre classes as well.

READ LAUREN'S STORY

The additional finance from the Second Loan must be for the same business as the first Start Up Loan, and the total amount borrowed at one time cannot exceed £25,000.

Second Loans are designed to help with the continued growth of your business – it is not a fund to rescue your business.

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We take your privacy seriously and are committed to maintaining the trust and confidence of our clients, visitors to our website and subscribers to our newsletter. Maintaining the security of your data is critical and we have implemented measures to ensure your privacy rights are respected and applied. We commit to process your data fairly, legally and to be transparent about how we do so.

This notice, which applies whether you use our services or use our website, explains our approach to data integrity and your individual rights.

It does not apply to pages hosted by our referral partners, independent consultants, and associates.

By registering with Smarta you consent to the collection, use and transfer of your information under the terms of this notice.

Put simply, we set out what we are going to do with your data in this Privacy Notice.

We ask you to read this Privacy Notice to ensure you are happy with the way that Smarta will process your data.
We ask you to confirm that you agree with our Privacy Notice when you confirm your decision to enter into a customer relationship with us.
We provide the option to opt into the different marketing options that you prefer.

The processing of personal data is governed by the General Data Protection Regulation 2016/679 (GDPR).

The notice may change from time to time so please check for updates.

If you need further details or are unsure in any way, please contact us at info@transmitstartups.co.uk .

Who are we?

Smarta is a trading name of Transmit Start-Ups Ltd which is a Limited Company registered in England. (referred to as “Smarta” “Transmit”, “we”, “our” or “us” in this notice).

Our registered number is 08702257.

Our registered office is Northern Design Centre, Baltic Business Quarter, Abbott's Hill, Gateshead, NE8 3DF.

What personal information do we collect and process?

We collect and process your data in the following circumstances:

When you register to join Smarta
When you join the small business directory
When you use our website
When you sign up for our mailing list
When you complete the contact form on our website
When you contact us through other means such as email, telephone, or web chat

Smarta may collect the following information about you:

Your name, date of birth and gender
Your ethnicity, qualification levels and employment status
Your contact details: postal address, telephone numbers (including business, personal & mobile numbers) and e-mail address
Your device’s IP address
Your online browsing activities on the Company website
Your communication and marketing preferences
Your interests, preferences, feedback, and survey responses
Your location
Your correspondence and communications with us
Other publicly available personal data, including any which you have shared via a public platform (such as a LinkedIn profile, Twitter feed or public Facebook page).
Information about your business

This list is not exhaustive, and, in specific instances, we may need to collect additional data for the purposes set out in this notice. Some of the above personal data is collected directly, for example when you engage with us. Other personal data is collected indirectly, for example your browsing activity. We may also collect personal data from third parties who have your consent to pass your details to us, or from publicly available sources.

Why do we collect and process your personal information?

We only collect and process the information needed to effectively provide our services to you, as well as for contact and communication purposes.

We will use your personal information as part of our internal reporting processes.

How is your personal information used?

We use your personal data:

To provide services to you
To effectively communicate with you
To respond to your enquiries
To make our website and other social media content available to you
To verify your identity
For crime and fraud prevention, detection, and related purposes (if mandated by law)
To contact you (with your agreement) electronically about promotional offers and services which may interest you
For market research purposes and to better understand your needs
To enable us to manage service interactions with you
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Where we have a legal right or duty to use or disclose your information (for example in relation to an investigation by a public authority or in a legal dispute)
Test new systems and check upgrades to existing systems to improve our service delivery
Help improve our products and services, for quality control, security, internal record keeping and other business needs

Certain types of personal information, such as gender and ethnicity, are used only as part of our contractual reporting requirements, for the purposes of monitoring and promoting equal opportunities.

The lawful basis for processing your personal information

Legitimate interest

We may collect, hold, and process your personal data on the basis of legitimate interest where it is necessary in order for us to fulfil our needs as a business and to be able to provide you with our services, including, but not limited to:

To send you information about your loan
To provide details of the benefits available as part of the loan agreement
Protecting customers, employees and other individuals and maintaining their safety, health, and welfare
Promoting, marketing, and advertising our products and services
Understanding our customers’ behaviour, activities, preferences, and needs
Improving existing products and services and developing new products and services
Complying with our legal and regulatory obligations
Preventing, investigating, and detecting crime, fraud or anti-social behaviour and prosecuting offenders, including working with law enforcement agencies
Handling customer contacts, queries, complaints, or disputes
Protecting Transmit Start-Ups Ltd., its employees, and customers, by taking appropriate legal action against third parties who have committed criminal acts or are in breach of legal obligations to us and our staff
Effectively handling any legal claims or regulatory enforcement actions taken against us
Fulfilling our duties and obligations to our customers, staff, colleagues, shareholders, and other stakeholders.

Consent

We collect, hold, and process your personal data on the basis that you give us consent when you accept this Privacy Notice.

We will seek your consent to hold and process your data when you sign up to our mailing list or we need to ask for any sensitive data as part of the application process. If you chose not to sign up to our mailing list, we will still communicate with you when necessary as part of our contractual obligations.

You remain in control of the personal data you share with Transmit. You can change your preferences at any time, by choosing whether you want to give consent to your data being processed for specific types of communication and / or communication channels.

Vital interest

We may use your personal information to contact you if we reasonably believe that the processing of your personal data will prevent or reduce any potential harm to you. This type of notification is in your vital interest.

Legal Obligation

We may use and process your personal data to comply with our legal obligations such as HMRC requirements, if it is genuinely needed for law enforcement, to identify you as an individual if you contact us, or to verify the accuracy of your data.

Who we share your personal information with

Our service providers and suppliers

In order to make certain services available to you, we may need to share your personal data with some of our service partners. These include HMRC, cloud storage and IT providers.

Transmit only allows its service providers to handle your personal data when we have confirmed that they apply appropriate data protection and security controls. We also impose contractual obligations on service providers relating to data protection and security, which mean they can only use your data to provide services to Transmit and to you, and for no other purposes.

Where your personal information is stored

Your information is stored on dedicated hardware used by Transmit Startups and all data is held and backed up within the UK or EU or is covered by the EU-US Privacy Shield Framework .

The data is stored within a MariaDB database in a secure hosting environment. The only way to access the database is via a server console or via SSH.

User data is also synced into Hubspot – a cloud-based Customer Relationship Management system.

Images & Assets are securely hosted on a service called S3 - which is an Amazon Web Service (AWS) service. Only authenticated users within the site have access to push files to this location.

Where you communicate with us by email, we may store copies of the emails. Our email service is provided through Google G Suite .

How we keep your personal information secure

We are committed to keeping your personal data safe and secure.

Our security measures include:

Encryption of sensitive data
Back up of data
Password management
Implementing risk management and data impact assessment analysis
Regular cyber security assessments of all service providers who may handle your personal data
Security controls which protect our IT infrastructure from external attack and unauthorised access
Internal policies setting out our data security approach and training for staff.

Only authorised and trained personnel can access your personal information if required to do so as part of their legitimate job role.

How long we keep your personal information

We will not retain your data for longer than necessary for the purposes set out in this notice. As long as you wish to be a customer of Smarta or be displayed in our directory we will retain your data for that purpose.

Your personal data stored in the website’s database will be automatically deleted from here after five years. You can request the amendment or deletion of your data at any time.

Automated decision making, including profiling

We may retain some data for reporting and statistical purposes however this will only occur after removing all personal information that would allow an individual to be identified. This is called anonymisation.

Transmit do not engage in any profiling activity.

When do we collect your information?

Website forms

Our website has forms built-in to allow the user to create an account and interact with the site via the submission of data. When you use our forms, the information submitted is securely stored in the website’s database. Your personal data stored in the website’s database will be automatically deleted from here after five years. Your personal data is encrypted by the website.

The website is built using a framework called Laravel (it is an open-source PHP MVC framework for bespoke platform development).

The forms are built within this stack using VueJS, form data is submitted via Axios (AJAX HTTP requests) to a controller that parsers the data and stores in within a data store.

Sensitive data and passwords are encrypted using OpenSSL and the AES-256-CBC cipher.

Mailing list

If you opt-in to our newsletter when registering we collect your email address and name so that we can correspond with you. Your personal data will be stored on the website and Hubspot, which we use to send our newsletters. You can request to be removed anytime by clicking ‘unsubscribe’ in any newsletter/mailout or by contacting us.

Online data management (analytics and security)

When someone visits our website, we use a third-party service, Google Analytics, to collect standard internet log information and details of visitor behaviour patterns.

We collect information about your computer and about your visits to and use of this website (including your IP address, geographical location, browser type, referral source, length of visit, entry and exit points and the number of page views).

We do this to find out things such as the number of visitors to the various parts of the site.

This information is only processed in a way which does not identify anyone.

We do not make and do not permit Google to make, any attempt to find out the identities of those visiting our website.

If we do ever want to collect personally identifiable information through our website, we will be upfront about this. We will make it clear when we collect personal information and will explain what we intend to do with it.

Website security and backups

Our website has HTTPS encryption via a Let’s Encrypt SSL certificate to ensure any data passed between your browser and the web server (where this website is hosted) is encrypted. When you are on a secure page, a lock icon will appear on the bottom of web browsers such as Microsoft Internet Explorer.

This website and its database are automatically backed up every day via our hosting provider AWS (Amazon Web Services). Backups are stored for 90 days in the EU Region.

Links to Other Web Sites

This Privacy Notice does not cover the links within our site linking to other websites. Those sites are not governed by this Privacy Notice, and if you have questions about how a site uses your information, you will need to check that site’s privacy information.

Cookies

Like most websites, the Smarta website uses cookies to collect information. Cookies are small data files which store information on your browser, your computer, or other connected devices (such as smart phones or tablets). Cookies allow us to recognise that you have visited our website previously.

Cookies are essential for the effective operation of our website; they make it easier for you to maintain your preferences on our website and improve your web browsing experience.

The cookies stored on your browser, computer, or other device when you access our websites are designed by Smarta, or on behalf of us, and are necessary to improve your use of our site.

Some cookies collect information about browsing behaviour when you access this website via the same browser, computer, or device. This includes information about pages viewed and your journey around a website. We do not use cookies to collect or record information on your name, address or other contact details.

A cookie often includes a randomly generated number which is stored on your device. Many cookies are automatically deleted after you finish using the website.

Use of Cookies

This website does not store any information that would, on its own, allow us to identify individual users of this service without their permission. Any cookies that may be used on this website are used either solely on a per session basis or to maintain user preferences. Cookies are not shared with any third parties.

The main purposes for which cookies are used are:

For technical purposes essential to effective operation of our websites, particularly in relation to site navigation.
To enable us to collect information about your browsing patterns, including to monitor the success of conveying our information to you.

Types of cookies that may be used during your visit to the website are listed below:

Cookie Name	Expiration Time	What It Does
smartabusinessdirectory_session	1 Day	Session cookies are a way of storing the user information across multiple user requests via secure encrypted cookies. This cookie will be deleted after the current session is finished.
XSRF-TOKEN	1 Day	CSRF "token" for each active user session managed by the application. This token is used to verify that the authenticated user is the one making the requests to the application.
_ga	2 Years	Registers a unique ID that is used to generate statistical data on how the visitor uses the website.
_gid	1 Day	Registers a unique ID that is used to generate statistical data on how the visitor uses the website.
_gat	1 Day	Used by Google Analytics to throttle request rate.
_fbp	3 Months	This cookie is used to measure, track, and retarget with Facebook ads.

How do I disable cookies?

Most browsers allow you to reject all cookies, whilst some browsers allow you to reject just third-party cookies. For example, in Chrome, you can block or allow all cookies by default. On your computer, open Chrome. At the top right, click ‘More Settings’, then under 'Privacy and security', click Cookies and other site data and select an option.

How you can do this will depend on the browser you use. Further details on how to disable cookies for the most popular browsers are set out below. Please be aware that blocking all cookies will, however, have a negative impact upon the usability of many websites, including ours.

Microsoft Internet Explorer
1. From the Tools menu, select Internet Options.
2. Click on the Privacy tab.
3. Select the appropriate settings.

Google Chrome
1. Choose Settings> Advanced
2. Under “Privacy and security,” click “Content settings”.
3. Click “Cookies”

Safari
1. Choose Preferences > Privacy
2. Click on “Remove all Website Data”

Mozilla Firefox
1. Choose the menu “tools” then “Options”
2. Click on the icon “privacy”
3. Find the menu “cookie” and select the relevant options

Opera 6.0 and further
1. Choose the menu Files”> “Preferences”
2. Privacy

International transfers

To deliver a full range of services to you, it may be necessary for us to share your data outside of the European Economic Area. This will typically occur when service providers are located outside the EEA or if you are based outside the EEA. These transfers are subject to special rules under GDPR.

If this happens, we will ensure that the transfer will be compliant with data protection law and all personal data will be secure. Our standard practice will be to use ‘standard data protection clauses’ which have been approved by the European Commission for such transfers. Those clauses can be accessed on the European Commission website.

How you can help protect your personal information

If you are using a computing device in a public location, we recommend that you always log out and close the website browser when you complete an online session.

In addition, we recommend that you take the following security measures to enhance your online safety:

Keep your account passwords private. Remember, anybody who knows your password may be able to access your account.
When creating a password, use at least 10 characters. A combination of letters, symbols and numbers is best. Try not to use easy to guess words, your name, email address, or other personal data that can be easily obtained. We also recommend that you frequently change your passwords.
Avoid using the same password for multiple online accounts.

Your rights in respect of the personal information we hold

We fully support and facilitate the ability of people to exercise their rights in respect of the personal information supplied to others. See our Privacy Policy - https://transmitgroup.co.uk/privacy-policy/

If you wish to correct, complain, object, or otherwise control the data we hold please contact us and we will respond accordingly.

Please contact us if you have any questions about how your personal information is being used or if you are unhappy about our service or anything we do. We will do our best to resolve the issue.

An overview of your different rights

You have the right to request:

Access to the personal information we hold about you, free of charge.
The correction of your personal information when incorrect, out of date or incomplete.
For example, when you withdraw consent, or object and we have no legitimate overriding interest, or once the purpose for which we hold the personal information has come to an end.
That we stop using your personal information for direct marketing (either through specific channels, or all channels).
That we stop any consent-based processing of your personal information after you withdraw that consent.

Your right to withdraw consent

Whenever you have given us your consent to use your personal information, you have the right to change your mind at any time and withdraw that consent.

Where we rely on our legitimate interest

In cases where we are processing your personal information based on our legitimate interest, you can ask us to stop for reasons connected to your individual situation. We must then do so unless we believe we have a legitimate overriding reason to continue processing your personal information.

Direct marketing

You have the right to stop the use of your personal information for direct marketing activity through all channels, or selected channels. We must always comply with your request.

How you can access the personal information we hold

You can access a copy of the personal information we hold by submitting a Subject Access Request to us using the contact details below.

We will respond to as soon as possible, and in any event, within one month of verifying the request. Our Subject Access Request policy can be provided on request.

To protect the confidentiality of your personal information, we will ask you to verify your identity before proceeding with any request you make under this Privacy Notice. If you have authorised a third party to submit a request on your behalf, we will ask them to prove they have your permission to act.

Getting in touch with Smarta

We can be contacted at:

Smarta,
Northern Design Centre,
Baltic Business Quarter,
Abbott's Hill,
Gateshead,
NE8 3DF

Book a call

Email: info@transmitstartups.co.uk

The Supervisory Authority in the UK

The Supervisory Authority in the UK is the Information Commissioners Office (ICO).

Transmit Start-Ups Ltd can be found on the Data Protection Register. The registration number is ZA047144.

Complaints

If you would like to make a complaint about the way your personal data has been handled by Smarta, you can contact us using the details given above. Our complaints policy can also be provided on request.

Alternatively, you can refer your complaint to the ICO - https://ico.org.uk/make-a-complaint/