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Lenders in the UK will be subject to sweeping new transparency rules that will allow consumers to compare how long it will take to open a current account, and how frequently a bank has reported security incidents.
The rules, published by the Financial Conduct Authority on Tuesday, are intended to encourage potential customers to shop around by allowing “meaningful comparison” of lenders. Banks will be obligated for the first time to publish the number of complaints they receive, and other details like how long it takes to reissue debit cards.
The FCA has made shaking up the UK’s retail banking market one of its key priorities for the year. Retail banks were already the subject of a sweeping review by the Competition and Markets Authority, and the FCA’s rules are designed to “complement” the recommendations of the CMA, which found that just 3 per cent of Britons switched their current accounts in the preceding 12 months, while 57 per cent have been with the same provider for more than a decade.
“We want to see current account providers competing hard for their customers’ business by offering better service, alongside competition on interest and charges,” said Christopher Woolard, the FCA’s executive director of strategy and competition. “These rules will help people see how their bank compares to others so they can choose an account that suits their needs.”
UK Finance, the trade association, said it welcomed “effective competition”.
“Making it easier for consumers and businesses to compare the quality of service offered by different current account providers is a great way to encourage customers to shop around,” said Eric Leenders, UK Finance’s managing director of personal finance.