Category: Finance


Tips to Get Started As a Private Money Lender

May 28, 2018

Finance

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When one is fortunate enough to have capital or money to lend to the people who need it, they best thing that they can do it is to offer it those who have the need and the ideas to use the capital in an innovative and productive manner. This would embark the lender on a journey of private money lending. There is a great demand in the borrowers market for those who may be able to offer private money lending and those who have the capital at their disposal for the use of those who are brimming with ideas and innovations, but are not able to put them into action due to the lack of funds and there are times when these ideas do not get due recognition and encouragement from banks or money lending institutions. In such cases, private money lenders and borrowers are able to find their win-win situation.

While private money lending may be a lucrative alternative, it is essential to make sure that a few points are checked before embarking on the journey to money lending. One of the most important points is to ensure that the trade of private lending is understood in a proper fashion. If the lenders start giving out funds with the hope for getting returns, without having the knowledge of safe lending, the entire exercise may lead them to bad debts and losses. A thorough research on the type of lending and the knowledge of gauging the right candidates for lending is a must. It is also beneficial to a great extent to know other like-minded people. With research about the kind of people who get into private lending it becomes simpler to understand their way of thinking and it also helps in understanding how the field can be tackled with expertise. Finally it is important to know the details and the strong points of investments. Not only does it help in investing in the right idea, it also ensures in knowing how effective the borrowers idea of investment may be.

When Finance companies or Financial Solutions companies are asked for an opinion, they would suggest that the private lending should be done with the help of an expert medium. This implies that when a known and knowledgeable team is involved in the field of finance and lending, the private lender and company may be able to make secure and profitable investments.

If you think you are cut out for the profitable prospects of private money lending and have the resources to match your aspirations, make sure you use the safe embrace of Syndicate Finance to lend your capital.

Neurofinance and the Risk Mindset

May 28, 2018

Finance

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Increasingly the findings from neuroscience are being applied to the world of finance. This is not surprising as neuroscience has plenty to contribute to our understanding of the decision-making process and the financial decisions we make are among the most important.

Expanding our understanding of financial decision-making and how to develop a ‘risk mindset’ can help protect organisations against the type of market booms and busts that plague economies around the world.

Improving financial decision-making

Poor financial decision-making can be damaging at both a personal and a professional level – creating stress in the home and insecurity at work.

Unsurprisingly, low financial literacy levels are a major contributing factor to this; but our own understanding of how we make decisions also affects our decision-making.

Most of us believe that we are able to keep our emotions in check; that we are able to put feelings, emotions, and memories to one side and just base our financial decisions on the cold hard data – the numbers.

Neuroscience has shown us that the brain doesn’t work like that. In fact, our emotions play an important role in decision-making. Consider an occasion when you have been resolute in a decision, but been persuaded otherwise after a talk with a friend, colleague, or family member; emotional reasons often force this change of mind.

When this tendency to make emotional decisions is combined with an increasingly complex financial landscape, where the number of choices for financial products and services is mind-boggling, we begin to understand the risks involved.

Financial service companies need to improve the literacy of their customers. In the past there has been a sense that financial organisations have a vested interest in keeping everything vague and complex, unintelligible to all but a few. But the winning organisations of the future will be educators that simplify their products and services for customers, and raise financial literacy levels.

Recent insights from behavioural economics and neuroscience can assist with designing financial products and marketing campaigns that promote better understanding for customers and employees, encouraging better financial advice, and improving the likelihood of a good financial decision being made.

Developing a ‘risk mindset’

Ensuring that the right financial products are sold to the right people, for the right reasons, and that customers fully understand what they are purchasing, requires a ‘risk mindset’.

This is becoming more necessary as financial regulations become tighter around the world, and financial organisations start to repair the image problems they have experienced in recent years.

But it takes more than just paying ‘lip service’ to regulations; it is about bringing real value to the customer experience.

With the aid of neuroscience and a better understanding of the decision-making process, organisations can:

  • Create a culture where the ‘regulator’ mindset is adopted in a constructive way, using principles that underlie the regulation rather than just blindly following the letter of the law.
  • Re-design incentive schemes less likely to result in mis-selling
  • Develop structured processes and a common language that all areas of the organisation can use to focus on the customer
  • Adapt existing products and services to have a positive impact on the customer experience
  • Foster collaboration and change between and within traditional organisational ‘silos’.