New competition regulator to begin review of banking
The Competition and Markets Authority (CMA), the UK's new competition regulator, has announced today that it’s starting a short programme of work into the banking sector, with a decision on whether or not to make a market investigation by the autumn.
It’ll publish its work on person current accounts and SME banking in the summer, which is part of a wider retail bank review, following up with a consultation before making a decision on an investigation.
The CMA, which'll take on what's currently done by the Office of Fair Trading (OFT) and Competition Commission in April, says it’ll be building on the work done by the OFT into banking for SMEs and current accounts, also working alongside the Financial Conduct Authority.
From this morning’s statement:
Based on the OFT’s 2013 findings on personal current accounts and the work to date in the market study of SME banking, there appear to be important similarities between competition issues for personal current account customers and for SME customers, in particular:
- the banking providers operating in the sector
- how dynamics of competition operate, and
- the way that personal and SME customers consume banking services, including levels of customer engagement with banking providers.
The CMA will assess ongoing and planned steps taken in the sector, updating the ongoing review of personal current accounts. That includes how effective the introduction of the new seven-day Current Account Switching Service has been, along with the impact of the divestments by Lloyds and RBS as part of their retail banking businesses. It’ll also look at the forthcoming setting up of the Payment Systems Regulator.