Richard Lloyd, Which? executive director, said:
“Today’s decision means it’s now crunch time for the biggest banks that dominate a market blighted by a lack of trust and poor customer service.
“We want the Competition and Markets Authority to expose the cost to consumers of a lack of competition in the current account market and to pave the way for reform. In the meantime the banks should seize the opportunity to demonstrate that they can put their customers’ interests back at the heart of their business, whatever the outcome of this inquiry.”
Notes to editors:
1. The big four banks collectively supply more than three-quarters (77%) of the personal current account market in the UK.
2. In the first six months of 2014 current accounts were the most complained about product, after Payment Protection Insurance (PPI), according to the FCA. They received a total of 319,505 complaints about current accounts in the first six months of 2014, that’s more than an 11% increase compared to the same period in 2013.
3. The latest Which? Consumer Insight Tracker data reveals three in ten (31%) don’t trust day-to-day banking.
4. Which? has set seven tests for a truly competitive current account market:
- Are firms competing genuinely with better quality, innovative products or are they exploiting consumers’ behaviour?
- Are consumers getting a choice of products which meet their needs and offer value for money?
- Is there enough clear information about the product for consumers to compare easily?
- Are there enough engaged consumers to drive competitive pressure?
- Do consumers have everything they need to drive competitive pressure – are there barriers to switching?
- Are consumers able to get quick and fair redress when things go wrong?
- Are new firms which offer a better deal to consumers able to enter the market and compete on a level playing field?