New figures from questions asked by leading Brexit currency protection company Assure Hedge in a Dublin Chamber survey show that well over half of SME’s are worried about the volatility of sterling as a result of Brexit. Companies also fear a weakening of Sterling beyond 5% would put their profit margins at risk.
These survey findings come in the wake of the Bank Of England’s Mark Carney issuing stern warnings that the value of sterling could plummet by up to as much as 25% in the case of a No Deal Brexit.
The data was revealed to mark the launch of a new service, brexitprotection.ie, that offers Irish SME’s who do business in Britain and around the world the opportunity to log on to the new platform and guarantee an exchange rate for their company’s future currency needs, right up to March 29th 2019, Brexit D-Date.
Using this new service Irish businesses, from agricultural exporters and manufacturers to food and craft producers doing business to and fro with the UK, will have the added safety net of safeguarding their profit margins by making sure they are not wiped out by exceptional volatility in the Euro / Sterling exchange rate regularly brought on by Brexit.
Speaking at the launch of BrexitProtection.ie, CEO Barry McCarthy said “We specialise in one thing and that’s getting small Irish businesses through the uncertainty being whipped up by Brexit. Our solution means Irish companies can continue to successfully trade with the UK and other foreign currency markets and realise profits regardless of Brexit related currency fluctuations, and that’s our aim for the next 6 months”.
“As has been the case for the past decade, the big legacy banks in Ireland are continually under-serving small Irish businesses on this issue and only make currency hedging services available to the big players – our platform is for everyone” he added.
Assure Hedge, the company behind BrexitProtection.ie, was founded in 2016 by Barry McCarthy and is based in Dublin’s IFSC. Servicing a client base across Europe, Assure Hedge has doubled its workforce in the past four months and plans to double it again in the coming months. They are fully regulated in Ireland and as of this year, in 31 countries across Europe including the UK.
Speaking about the survey, Dublin Chamber spokesman Graeme McQueen said “In a recent poll we ran amongst our members’ companies, more than half expressed a degree of worry about the potential impact of currency volatility on their business. Almost a quarter said they were either worried or very worried, with a further 35% saying that they were ‘a little worried’. Typical responses from firms were that any change of more than 5% would wipe out their profit margin. These stats show how exposed many firms are to the potential volatility that lies ahead.”
“For any Irish business that is doing business abroad, currency fluctuations are of major concern. Any sharp depreciation of Sterling would have a big impact on business. Bigger firms are typically able to protect themselves more easily – by hedging etc. However, it can be much trickier for smaller firms. When you’re trading abroad, margins can be tight, meaning that any sharp change in conversion rates can have a major impact.” he added.
Assure Hedge gives the small to medium business owner a premium digital solution that allows access to similar FX and hedging products as a large business or corporate has through a traditional business bank.
BrexitProtection.ie offers a simple explanation of what’s involved with Brexit related currency risk and allows its customers to generate a quote with just two clicks via their mobile phone or laptop.
To purchase the protection all businesses need to do is to choose the protection package and enter in the amount of Sterling or Euro they wish to protect. For regulatory reasons, onboarding will be done over the phone where the deal will be completed.