In a win for our Scrap the Savings Trap campaign the Financial Conduct Authority (FCA) today announced proposals to make switching savings accounts quicker and easier. Savings providers will also be required to provide clearer information on interest rates and better alert customers to the end of bonus rates.
Which? Executive Director Richard Lloyd responded:
"For too long, banks and building societies have left customers languishing in poor value savings accounts so today's move from the FCA is a significant win for savers and the 69,000 people who supported our Scrap the Savings Trap campaign.
"With many savers never switching because they don’t think it will make a difference, it's good that the FCA has listened to our calls to make savings providers do more to help customers get a better deal."
Which? had estimated that savers were losing out on £4.3bn each year by being stuck in sub-standard savings accounts.
As the Isa deadline approaches, our research has found that bank and building society staff’s knowledge of cash Isas is shockingly poor and could be leaving customers out of pocket.
Richard Lloyd, Which? executive director, said:
‘It is inexcusable for so many bank staff to have such a worrying lack of knowledge about the basics of Isas, especially when it could be costing customers dear. Banks should have systems in place to ensure customers can rely on them to give up to date and accurate information.
'With new reforms announced by the Chancellor this week, the banks must do better, starting by properly equipping their staff so customers can be confident they’re getting the right advice about how to make the most of their hard-earned savings.'
Isas are supposed to be simple savings products, but when we posed as new customers to ask straightforward questions about savings limits and transfers we found real problems. For example, there was widespread confusion and poor information on Isa transfer rules - though these have been established for years. Eight in ten bank staff couldn't identify the new 2015/16 Isa limit of £15,240. In fact, some banks hadn’t updated their systems for their staff to look the figure up.
The worst performers (Co-operative Bank and Yorkshire Bank) answered just 31% of questions correctly.
Our Scrap the Savings Trap campaign calls for quicker Isa switching and for interest rates and terms for all accounts to be clear, easier to compare and provided regularly to customers.
The Financial Conduct Authority (FCA) is taking steps to ensure banks and building societies display interest rates clearly and prominently, and improve the way they let customers know about the end of bonus rates and fixed terms on accounts. However, these improvements only consider written communications. They should be reflected in all customer service, so that people can get the facts and make informed decisions about their savings.
RBS welcomes our campaign and reaffirms its commitment to strive to make savings simple.
Santander welcomes our campaign and promises to make it easier for customers to manage their money.