POGOs Also Experiencing Financial Difficulties Due to Global Economic Crisis

Several Southeast Asian countries that invested in land based casinos to boost their tourism industry suffered from fallouts caused by the COVID-19 pandemic Yet one Southeast Asian country that benefited from the turn of events is the Philippines. Mainly because several years prior to the pandemic, the country had established itself as a regulatory haven for Asia-facing online gambling operators, officially known as POGOs (Philippine Offshore Gaming Operators).

Through its economic zones and gambling regulator, the Philippine Amusement and Gaming Corporation (PAGCOR), the Philippine government allowed numerous existing providers like Playtech and Realtime Gaming to establish their base of operations on Philippine soil so they can better serve their Asian customers. The move also encouraged numerous Asian entrepreneurs to invest in online gambling products, services and technologies.

Playtech and Real Time Gaming, by the way, provide the online casino games offered by a popular Asian online casino called 918kiss, which mainly operates by way of downloadable mobile phone applications

At the height of the global pandemic lockdowns, several POGOs were able to obtain PAGCOR’s approval in allowing them to operate and keep their online casino sites running. PAGCOR’s grant of approval however, depended on a POGO’s compliance with the health and safety measures and more importantly, on up-to-date payment of regulatory fees and tax obligations. After all, the ensuing lockdown measure imposed globally was an opportunity that POGOs could not let pass, as Asian gamblers were showing increased interests in online gambling entertainment.

Success of PAGCOR POGOs Spurred Calls for Increased Taxation Among Philippine Lawmakers

In 2019, the Philippines had established itself as a world leader in regulated online gambling, for being able to collect as much Php 8 billion (USD 164.3 million) in revenues from POGOs. In seeing the profitability of the POGO industry, several Philippine lawmakers called for proposals to increase the tax rates imposed on offshore online gambling operators.

However, the move elicited warning from PAGCOR President and Chief Operating Office, Alfredo C Lim, for the government to refrain from overtaxing POGOs as doing so would drive away offshore gambling operators. Mr. Lim asserted that in addition to taxes on offshore gaming revenues, the Philippines is also benefiting from rentals of high-end commercial space and availability of local employment opportunities.

PAGCOR and Its POGOs are Currently Dealing with Declining Revenues

True enough since the economies of neighboring Asian countries have been hurt by the pandemic, even POGOs are experiencing decline in revenues. PAGCOR’s latest report stated that POGO revenues had plummeted by as much as 80%. That is why only 111 of the 218 accredited POGO firms operating in the country were able to secure clearance from the Bureau of Internal Revenue (BIR).

A BIR clearance denotes that all fees and taxes due, including the monthly regulatory fees collected by PAGCOR, have been settled. PAGCOR continued to require it as a condition before they can resume operations, after the government eased down on lockdown orders for nonessential businesses

Moreover, Jose Tria, PAGCOR’s AVP for Offshore Gaming Licensing, reported that as many as 42 online gambling service providers have withdrawn their PAGCOR accreditation, another five (5) POGO licenses were canceled, while five (5) other licenses are currently suspended.

As a result, the monthly regulatory fees collected from POGOs that usually amounted to Php 600 million (US$12.4 million) is now down to nearly half, or Php 300 million (US$6.2 million). As several POGO offices are now closing down, even the related income from real estate leases and other businesses that benefited from POGO foreign workers, are reporting declines in revenue.

Understanding the sectors of economy

In the economy, industry and commerce are divided into different areas, called sectors. This term can be derived from the Latin word “sector” and literally means “something that cuts”. A sector is therefore a section, you can also say an area.

Different sectors in the economy

The primary sector

It comprises the original production, also called primary production. This means that in this area, the raw materials are extracted and delivered for further processing. So this is about the procurement of unprocessed goods directly from nature. The first sector includes agriculture, fishing, forestry, hunting, and the extraction of natural resources such as coal. The primary sector is therefore associated with a lot of physical work. It is also said that the sector is “labor-intensive”.

The secondary sector

This is also called the industrial sector. As the name suggests, the focus is on the industry. This is where the raw materials from the first sector are processed. In addition to industry, this area also includes craft, energy and water supply, and the construction industry. The secondary sector, therefore, needs a lot of machines and the raw materials for further use. Because the raw materials and the machines for processing must be purchased, a lot of capital, i.e. money, has to be raised. Forex brokers here can give an aid.

The tertiary sector

This is also called the service sector. In the third area, the goods are distributed and consumed. All professions that cannot be assigned to the first two sectors fall under this area. Banks, trade, administration, doctors, journalists, lawyers, hospitality, insurance, cultural workers, and many others make up the service sector. This means that this sector is, above all, very labor-intensive, so you need a lot of workers.

The Quaternary sector or also known as the information sector

However, the use of the term in economy is not uniform. According to one definition, this includes activities from the tertiary sector that require a lot of responsibility or require high intellectual abilities – such as consulting activities such as lawyers, business consultants, medical and educational professions or professions in information and cutting-edge technology such as computer or biotechnology.

Fintech Lenders : When the Need for Extra Funds is Immediate

It is now apparent that the stimulus loans offered by the government are not as readily available and/or workable, as funding options for needy entrepreneurs.

While the Payroll Protection Program (PPP) of the CARES Act immediately grants $10,000 to successful applicants, many encountered difficulties in preparing and obtaining documents required for speedy and successful processing of their stimulus loan application.

When it became apparent that as the 2020 health crisis will drag on, it became clear for many entrepreneurs that the fastest way they can secure a loan is through fintech lenders. Small businesses have come to realize that in order to survive, they need to immediately bring their business online, incorporate e-commerce technologies as well as launch promotional and marketing campaigns.

However, they need to have additional personal financial resources, if they need to spend extra on restarting their business online.

The PPP charges only 1% of the unforgiven loan balance in case business owners do not meet the requirements to qualify for the forgiveness of loan balance. Yet for entrepreneurs whose need for funding is immediate, competing with the multitude seeking to obtain a PPP loan can be a long and arduous task. That is why many turned to fintech lenders instead.

Who are the Fintech Lenders?

Fintech lenders are companies that utilize Artificial Intelligence, big data, the power of the Internet and partnerships with traditional financial institutions in offering personal or even mortgage loans. Through innovative technologies, fintech lenders have eliminated the need to process loan applications using outdated and complicated methods.

Some examples of today’s leading fintech lenders include:

TALA – Santa Monica, California

Through a consumer-lending app, TALA underwrites loans based on data provided by app-users’ smartphones or smart devices. Examples of data used in determining a Tala loan-applicant’s credit-worthiness include bill payments, social media connections and activities. So far, TALA reports that the company has assisted more than 3 billion new users in obtaining personal loans that will help them build their credit. .

AVANT – Chicago, Illinois

Using its fintech technologies, AVANT offers consumers the Avantcard that enables customers to obtain credit for small shopping purchases or larger loans for emergency needs, home repair or a vacation trip.

BRAVIANT HOLDINGS – Chicago, Illinois

Like TALA and AVANT, Braviant Holdings uses technology and big data analytics in verifying and processing applications that allow the company to make quick decisions. Unlike other fintechs, Braviant Holdings cater mostly to under-banked people, providing them with credit cards to use like Balance Credit and Chorus.

What Factors Affect Changes In Exchange Rates?

The forex is particularly determined by supply and demand. The exchange rate largely depends on them. This is particularly dramatic when, for example, fund companies, banks or entire countries carry out large enough trades in one go. Then the price can suddenly rise suddenly or drop just as suddenly.

Foreign exchange rates are of great importance for all traders in the forex market. So it is important to know the factors that make an impact on the exchange rate.

What influences Foreign Exchange Rate?

The developments in the market. This can be read on a so-called chart. It shows the price trends graphically in a line chart. Brokers like Pepperstone (read Pepperstone broker review) need such charts for their work. You can use them to read the exchange rates and use them as the basis for your future forecast. The finance experts try to read trends in the chart analysis.

Political decisions or elections. The influence of elections can currently be seen very well in the US dollar. Since Donald Trump’s election in November, the dollar has lost value steadily against the euro. In addition, since Trump’s election as president, Mexico has had to throw hundreds of millions of dollars in the market to counter the fall in the price of the peso, fueled by protectionist tones. Fortunately, from Mexico’s perspective, this was possible thanks to large currency reserves.

International crises. In contrast, the consequences of the nuclear dispute with North Korea remained unexpected. While foreign trade and foreign investment declined sharply, the South Korean Wong was relatively unimpressed.

Events in the economy. If, for example, a change occurs at the top of large automobile manufacturers, technology or energy groups, this can also affect the exchange rate if the company is large enough. But the publication of annual figures for important companies can also have a major impact. The change in price can first be seen in the leading indices of the shares.

Natural disasters. Natural disasters and environmental events can also have a significant impact on the currency market. When hurricane Irma headed for Florida, the dollar reacted immediately. Investors feared high losses from the storm, with insurers currently facing $ 40 billion in costs. But when the storm lost strength, the dollar regained strength.
Consumer climate and trade index. Both economic indicators make it possible to forecast the near future economic future of a country. This in turn is decisive for the strength of its currency.

Commodity / oil prices. Commodity prices in general and in particular the prices of crude oil and natural gas also play an outstanding role for the foreign exchange market.

Capital movements. In the case of capital flows, the proportion of underlying real economic transactions has fallen to up to 10%. The lion’s share is speculation. As a result, the stock exchanges are also price drivers. Here, however, it is true that a weak stock market leads to rising prices because investors are fleeing into fixed-income alternatives. It is therefore worth taking a look at the most important stock markets with regard to forex trading.

Monetary policy. The currency policies of individual countries can also lead to price movements that are difficult to predict. In addition to Mexico, Russia and China have recently had to throw large amounts of US securities on the market to strengthen their currencies. While it may be predictable that these steps would be necessary, the exact timing is difficult to estimate.

Conclusion

The list could go on and on. The slightest tremor can upset the markets and start huge flows of capital. Sometimes you expect them and then they stay away. The forex market is very complex and certainly not for beginners. On the one hand there are quick and high winnings, on the other hand the tide can turn quickly and everything is lost. It is therefore advisable to deal with the matter in detail beforehand before engaging in forex trading on the forex market .

Fintechs Provide Tools to Help SMEs, Gig Workers

While financial technology companies are themselve getting hit by the ongoing COVID-19 crisis, yet several UK fintech innovators are helping small businesses stay afloat.

In recent years and all across the globe, fintech companies have been developing new applications or financial resources to help consumers and small entrepreneurs organise and improve finances. They have managed to ruffle the feathers of traditional banks and other lending institutions, by providing consumers and business startups with agile technologies and solutions for obtaining funds.

Although financial technology companies are not immune to the disruptions caused by the current coronavirus health crisis, some have shown concern on the impact of the current crisis on small businesses in the UK. Many fintechs are currently focused on providing quick solutions that can help small players obtain the government funding relief they need in the fastest and surest ways possible.

Solution Provided by Fintechs to Gig Workers and Independent Solo Entrepreneurs

UK fintechs, many of them volunteers, have been developing new tools aligned with economic relief programs that the UK government launched in helping consumers, gig workers and solo-proprietors of small businesses. Below are some examples:

Starling Bank

Starling Bank, a UK licensed and regulated bank that operates digitally and only by way of mobile devices, recently rolled out the “Connected Card.” It works as an emergency debit card that enables a Starling Account Holders restricted by orders for self-isolation, to extend the use of his or her account, not just to family members but even to carers and friends, so they can purchase essential items on the account holder’s behalf.

The Starling account holder is protected by limiting the Connected Card balance to £200; whist allowing him or her to track and manage use of the extended card, by way of a related mobile app.

“Covid Credit”

Several dozens of UK fintechs came forward to render volunteer work in helping build an application that enabled gig workers, freelancers and self-employed individuals to self-certify their lost income. The certification, being a document required by the UK government in processing applications for economic relief.

“Coronavirus Calculator”

Developers at Countingup, touted as the leading provider of agile solutions for banking and accounting needs of small business in the UK, came out with Countingup. This app enables self-employed individuals to immediately determine how much financial relief they could obtain from the UK government’s coronavirus funding program for small businesses ran by solo proprietors.

“Coronavirus Furlough HMRC Claim Calculator”

Pento, creator of automated payroll tools specifically for use of startup small businesses, created the “Coronavirus Furlough HMRC Claim Calculator.” This tool helps startup entrepreneurs determine how much they can claim as financial relief from the UK government under the “Coronavirus Job Retention Scheme.” The government program intends to help employers of small businesses keep workers employed instead of making them take a leave of absence.

Financial Assistance For Small To Medium Businesses Affected By Covid-19

Small businesses are among the industries that are most affected by the COVID-19 epidemic. To address this, the U.S. Small and Medium Business Administration provides economic relief loans. While these financial aid loans can be an important step for businesses looking to survive their business, the Small Business Administration says it is essentially looking at more plans to assist small businesses throughout the country by enlisting an authorized lender to provide additional loans.

Trump: We’ll Be ‘Making Lots Of Small Business Loans’ Amid Coronavirus Spread | NBC News NOW

The U.S. Small and Medium Business Administration defines small businesses as those with 500 employees or less. The only businesses to be excluded are lenders, gambling agencies or any type of speculative industry.

Businesses may apply for loans of up to $ 2 million at a rate of 3.75% for up to 30 years, but the SBA explained this is not the only plan under consideration to support the current economic climate.

“They are yet talking about this. There are numerous matters, and I can not guess what it’s going to be but I’m sure these negotiations are going on,” said department manager Steve Bugler. “The president, lawmakers, and the SBA are working together on this. “

Since no one knows how long this outbreak flu will last, the overall economic effect of the virus is unknown. Visit the SBA website for more information. Or you may call their direct number also found on their website.

Additional Financial Assistance From The SBA

There will be more financial assistance in the future through SBA loans given to SMEs. The White House declared that the SBA would give lower interest lending options to SMEs impacted by the Coronavirus, and on March 11 asked Congress to raise its $ 50 billion budget.

It is unclear which companies are eligible for financing or which loan programs are available. Contact your SBA regional office for the most recent info.

During the outbreak of the corona pandemic, are financial institutions ready to give assistance?

If you currently have a business loan and run a business within an affected region, you don’t have to stress about repayments being missed. Loan providers including Bank of America and Wells Fargo have issued statements that indicate they are ready to work with borrowers. Deferment or possible reduction of amount due may be an option as a result of the coronavirus incident. Check with the lender for available options.

Grants offered to businesses impacted by the coronavirus

Some local governing bodies like New York and firms like Amazon have begun providing cash aid to businesses impacted by the Coronavirus. These subsidies are smaller than standard loans and are restricted to businesses in a few areas. Grants offered by Amazon are available only to businesses in Seattle.

You can check with your local business unit to find out which big companies are providing grants in your area of business. The basic concept of some personal subsidies is to offset the income losses that some businesses may face after the company has a mandatory homework policy.

The Impact Of Corona Virus On Economies Throughout The World

The corona epidemic reveals how susceptible the network of economies is throughout the world. The main challenge started in China, however, it has spread and made a huge impact on American, European, and German companies. Technically throughout the global market.

Europe is feeling the effect of the Corona spread. Italy shows what could also come up in Germany. The virus, Corona is less fatal than any other previous epidemics. On the other hand, the virus is beginning to bring economic operations to a halt.

Coronavirus Affecting Economies and Businesses Around the World

Investors Are Alarmed

The financial market has been alarmed by the pandemic resulting in a market panic. Many investors including those who were eyeing on Canadian stocks to buy came to a standstill.

In China, besides the insufficiency of factory workers, there is also an issue on travel where truck drivers are not allowed to work and possibly fear to work. There had been traffic on the transportation of goods in significant regions of the country. For many weeks, operations have stopped, containers weren’t moved from the ports and therefore there was no movement from the factories to the shops.

The government in China is currently hoping to get people to return to work. This makes it possible for production to start in considerably less infected districts, even though the full potential could hardly be reached. This approach is supposed to stop the country’s overall economy from falling apart entirely and therefore placing the strength of the Communist Party in danger. Even so, it is utterly uncertain if the crisis in the nation is coming in order. Through these measures, however, there is a great danger that the virus will spread again.

The scenario in China and, recently, in Europe, investors in the financial markets became worried about the possible losses due to the pandemic compared to the 2008 financial crisis. The turmoil is not yet similar to the pressure of the tragedy at that time, however, the corona epidemic contains the possibility for a downturn that has not taken place since the monetary crisis. It is similar that a financial shock brought on by the virus could impact the world as a whole as it did.

A Total Unfavorable Scenario

Following the bankruptcy of Lehman Brothers in 2008, it has become clear how highly networked and connected the financial world was as it is still at this time. Today in the midst of the Corona turmoil we observe the tight connection of global industries in terms of production, logistics, as well as services.

The world hopes that the virus will come to a halt before it infects the entire world. Even with a low fatality rate, the number can increase into thousands. In addition, an outbreak could place the global economy in an exceedingly critical turmoil, considering a range of bankruptcies and people losing their jobs. Likely countermeasures are being outlined and solutions should be in place before everything goes out of hand.