Furlough scheme redundancies could trigger surge in tech

Ending in October, Rishi Sunak’s furlough scheme now demands employers to pay their employees’ National Insurance and tax contributions starting in August. Whilst this marks an expected recovery of the economy and the re-opening of businesses, shortage of liquidity could mean that redundancy announcements are underway.

Back in May, the Chartered Institute of Personnel and Development (CIPD) revealed that one out of four UK businesses were planning redundancies over the next three months – a concern for the millions of furloughed professionals across the country, but positive news for tech vendors looking to expand.

“As redundancies are accelerated, there is going to be more and more pressure applied to accountants and finance functions,” says Amit Pau, COO of Accloud. “For those companies that embrace the use of technology correctly, we will see repetitive activities such as bookkeeping or mundane process driven workflows being removed, and technology will be an enabler to deliver greater business outcome, drive productivity gains, and improve quality.”

Businesses that have implemented remote working have been “positively surprised by the adoption of their team members and consumers,” he adds.

“If we didn’t have a cloud environment, companies would have not been able to operate – we wouldn’t have been able to work remotely,” says Pau.

Redundancies resulting from the end of the furlough scheme could also spawn emerging technologies, he says.

“In recent times, there’s been audit scams, either within industries or accounting firms, wouldn’t it be great if technology was used to eliminate the quality of audit?”

Fintechs providing accounting firms with ways of “identifying compliance breaches for KYC AML”, for example, are likely to surge post-lockdown, he explains.

Pau says vendors who focus on a “collaborative environment,” and “who allow customers to sweat their current assets,” will also be in an advantageous spot.

The mass of redundancies that the UK will face in the upcoming months is yet an opportunity for the finance sector to reinvent itself, particularly as businesses recognise that technology can work overnight if the right approach is adopted.

“The finance function has the option to embrace technology, to reinvent themselves. And ask itself, how can industry and government reskill? Because with technology, there will be a reduction in employment in specific jobs. We have a duty, both as business leaders and government, to accelerate that reskilling,” says Pau.