Yesterday, the CMA said it would be imposing a package of measures to ensure banks worked harder for customers.
It’s hoped that the measures will improve competition in the banking sector for SMEs and make it easier to switch accounts.
Sue Lewis, chair of the Financial Services Consumer Panel, felt that the measures meant consumers would be doing the hard work of finding the best product from complex information, but despite this criticism it felt the report gave the FCA some evidence to take on the banks.
“The CMA has found that banks with the highest prices and lowest quality of service have the highest market share.
“These same banks are now set to dominate the design of rules on open banking.
“It is essential that challenger banks and consumer representatives can influence this process, or the big banks will just design systems to suit their own ends.”
Sue felt it was up to the FCA to design measures that would genuinely help consumers and encourage banks to do better.
“These measures should highlight good and poor practices, as well as [the] quality of individual products and services.
“We believe the FCA should look at an ‘opt-in’ rule similar to the US Overdraft Protection Law. Under this law, consumers have to request an overdraft facility, and agree the terms up front.
“The FCA should also consider a cap on unarranged overdraft charges, set at the net additional administrative costs.”
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