After an 18 month long investigation, the Competition and Markets Authority (CMA) today announced its plans to improve the UK’s £16bn current account market. But falling short of the mark, the CMA’s inquiry has achieved little more than to propose basic information measures.
Time and time again it’s been proven that competition in the banking sector isn’t working for consumers. It’s a sector in urgent need of a shake up.
The regulator believes today’s proposals could benefit bank customers by around £1bn over the next five years.
The CMA’s proposals to improve the banking market include:
- Plans to improve overdraft arrangements, with alerts to warn people about to slip into overdrafts and proposals to require banks to disclose the maximum unarranged overdraft fees they charge per month
- New online comparison tools and more prompts to encourage people to switch
- Plans to improve the current account switching switching service
Our Director of Policy and Campaigns, Alex Neill, said:
‘After 18 months this inquiry achieved little more than to propose basic information measures that the big banks should have introduced years ago. Steps to stimulate switching are welcome but the chance to deliver better banking for all consumers has been missed.
The responsibility will now ultimately lie with the Financial Conduct Authority to ensure that reforms deliver better banking services for everyone.
Alex Neill added:
‘They must also go further than better information to tackle the unfair, punitive charges faced by unauthorised overdraft users, some of whom are hit with fees far in excess of payday loans.
‘Only when the regulator addresses these unfair charges, and holds the banks to account for poor customer service, will we see the shake up in banking that's so desperately needed.’
Earlier this year we launched our campaign for Better Banks. We’re calling on the regulators, government and banks deliver better everyday banking. If you agree too then please sign our petition.
Two of the big banks have come out in support of our Better Banks campaign, which calls on the industry to deliver better everyday banking for their customers.