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The Competition and Markets Authority extends UK retail banking probe

Thursday 10 March 2016 09:37 CET | News

The Competition and Markets Authority (CMA) has extended its investigation into the UK retail-banking sector until mid-August 2016 to allow a fuller study of potential remedies that the countrys lenders would have to undertake.

CMA has published a notice of possible remedies also. which is focused on bank customers with personal current account overdrafts, marketwatch.com reports. We welcome responses [to the remedies notice] from all interested parties by March 21, the CMA said, the source cites.

The change in the CMAs timetable--the authority had originally planned to publish its final report in May 2016--pushes back possible changes to the UKs retail banking sector which the regulator says isnt sufficiently competitive.

In interim findings published in 2015, the CMA said that too few customers were switching accounts and that banks dont have strong enough incentives to work hard to compete for customers through better products or cheaper prices. The CMA also said banks should focus on helping and encouraging customers to switch accounts.

At the same, the regulatory has held back from requiring the countrys top lenders from making drastic changes to their businesses. UK retail and business banking is dominated by four banks: Lloyds Banking Group PLC, Royal Bank of Scotland Group PLC, Barclays PLC and HSBC Holdings PLC. In 2014, they held roughly 70% of personal current accounts and 80% of business accounts in the UK, according to the CMA. the source cites.

The authority said it would publish a working paper setting out our further thinking on our proposed remedy for a price comparison website for small and medium-size enterprises and welcome parties views by the same deadline of March 21.


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Keywords: The Competition and Markets Authority, probe, retail banking, Customers, incentives, low prices
Categories: Payments & Commerce
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