Not since the economic disaster of 2008 has the world felt such a terrible financial decline. The coronavirus is causing multiple issues around the world. Hospitals are overrun, short staffed, and short on equipment.
Economies all over the world are feeling terrible impacts. If you are an investor in 2020, then you might be wondering what you can do to safely diversify your assets in the time of the COVID-19 outbreak.
First, let’s take a look back at how all of this came to be.
Ground Zero
In December 2019, Chinese officials announced that they were witnessing a localized outbreak of a mysterious new viral pneumonia. This became known as COVID-19, or the novel coronavirus, and it wouldn’t be long before it would wreak havoc around the world. As the virus spread in Wuhan, surrounding areas, and eventually other countries, an immediate impact to economies around the world was felt. This has only worsened as the virus has spread uncontrollably.
While it has reached its peak in some areas, many countries, including the United States and many areas in the UK, have yet to reach their peak.
Changed, Forever
As it stands, economists are forecasting that it could take three years for economies to fully recover in the wake of one of the worst humanitarian disasters in modern history. Some even say that the changes are permanent and recovery to the level before the pandemic could take decades.
The virus itself is still very poorly understood and palliative treatments are still being created to combat the pandemic. While practices such as social distancing, quarantines, and shutdowns are becoming routine around the world, many are wondering how long this will last and what the ongoing impacts on the economy will be.
The Banking Sector Disruption
Essential services have remained open as much as possible to help mitigate the inevitable economic impact. Many businesses have adapted to offer modified services - this includes the banking sector.
Some of these adaptations in the banking sector include distancing and sanitation practices at branches, extended ATM services, and new online solutions for individuals and businesses.
Banks are leaning towards offering more credit options right now for individuals and businesses while also bracing for credit losses across the board, as well as lower margins. Falling central bank interest rates are also changing the banking scenery for both individuals and businesses alike, at a time when many clients are needing disaster relief loans.
Banking Tech Adoption - Do or Die
With the rise in fintech, the technology to take banking into the new digital age has been here for a while. All of a sudden, however, banks that have chosen to stick with old traditional means with little to no online banking options are looking to switch to digital services. Right now, more and more consumers are demanding digital solutions and safer investment options.
The fintech industry is now bracing for hardware shortages as the demand for digital banking has sharply risen with the emergence and spread of the novel coronavirus. Banks are working to quickly create innovative tech solutions to cater to clients, and governments around the world have been seen to lighten regulations on fintech to support weakening economies and consumer demands.
What does all of this mean for you? Well, as your domestic economy is struggling and fintech comes to the rescue, keep in mind that not all is loss. In fact, in the recession of 2008, there were jurisdictions that were barely impacted at all. For instance, Brazil barely suffered any losses at all.
Offshore Banking, Anyone?
Due to uncertainties and the obvious trust issues in the banking sector, we can learn that safely diversifying your assets via offshore banking could still be a very viable possibility.
Indeed, although we see that banks in the United States and Europe have stabilized since the last financial crisis, and the U.S. was seeing extremely promising growth, ahead of the coronavirus pandemic, now investors are second guessing everything. This has been witnessed by sharp declines in stock in economies everywhere.
While these once-strong economies will likely come back, it could take years after the pandemic has concluded. If you’re looking for ways to smartly invest and diversify your assets now, then offshore banking is still perhaps your most promising option.
As it stands, we are seeing stable offshore jurisdictions with increasing deposits, and this is a signal that more and more investors are trusting their assets in offshore banking in trying times.
Takeaway
If you were considering offshore banking before this crisis, then the time to pull the trigger is likely now. What you need to do next is to find the right solutions.
The real key to finding the right offshore banking solution is to find a jurisdiction that is stable - more stable than your home country, obviously - and was stable during the last financial crisis, and to find solutions that are supported by fintech. Fortunately, many offshore banks make it possible to set up an account and manage your investments without being physically present.
If you’re serious about saving your assets during the coronavirus pandemic, then offshore banking might just be the best option you have. Consult with us to learn whether going offshore is the right decision sfor you, as well as learn more about the available options for you.
APR
2020
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