Retail banking
Published 25 November 2016
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CMA recommendations to regulator
(1) Financial Conduct Authority (FCA) to undertake a programme of research into customer prompts and to implement measures as appropriate.
(2) FCA to create additional measures of providers’ service performance.
(3) FCA to identify, research, test, and, as appropriate, implement measures to increase customers’ engagement with their overdraft usage and charges.
(4) FCA to assess ongoing effectiveness of the monthly maximum charge (MMC) and consider whether other measures could be taken to further enhance its effectiveness.
(5) FCA to consider requiring personal current account (PCA) providers to offer online tools indicating customers’ overdraft eligibility.
(6) FCA to investigate how to engage customers more in considering overdraft features during the PCA opening process.
(7) FCA to attend the business current account opening industry group as an observer.
CMA recommendations to government
(8) HM Treasury (HMT) to give an authority powers to have regulatory oversight of the current account switching service (CASS).
(9) HMT to work with credit reference agencies and small and medium-sized enterprise (SME) lenders to enable SMEs to undertake soft searches for loans.
(10) HMT to review commercial, technical and regulatory developments in the area of sharing SME data.
(11) The Department for Business, Energy & Industrial Strategy (BEIS) to work with the British Business Bank and professional associations to explore ways in which their members can channel advice on identifying and choosing providers and sources of finance to SMEs.
Response
Recommendations 1 to 7: the FCA has agreed to take action on all of the recommendations made to it. It will act in a manner that advances its statutory objectives. See the FCA’s full response.
Recommendations 8 to 11: HMT has agreed to forward all 4 recommendations. See HMT’s full response.