Jim Shannon – 2016 Parliamentary Question to the HM Treasury
The below Parliamentary question was asked by Jim Shannon on 2016-06-06.
To ask Mr Chancellor of the Exchequer, what steps he has taken to regulate the level of bank account charges in the last 12 months.
Harriett Baldwin
The Government is clear that consumers must be able to access clear and transparent information about the charges that may apply to financial services products, including bank accounts. In addition, the Financial Conduct Authority requires firms to be clear, fair and not misleading when giving information to consumers, including on fees and charges.
Following extensive Government negotiations with the banking industry on basic bank accounts, in January 2016 the UK’s nine largest banks and building societies implemented an agreement to end bank charges on those accounts when a direct debit or standing order fails. Basic bank accounts are now truly fee-free, helping people to manage their money without fear of running up an overdraft.
The Competition and Markets Authority (CMA) is currently investigating the retail banking market, including personal current accounts. In its May 2016 provisional decision on remedies, the CMA proposed requiring banks to take steps including: a monthly maximum charge for unarranged overdrafts; alerts to help customers avoid unarranged overdraft charges; improving comparisons by allowing customers to share data on transactions with other banks and trusted third parties; and regular prompts for customers to check that they are getting good value from their banking provider. The CMA will publish its final report on the retail banking market investigation by 12 August 2016. The Government stands ready to take action once the final report is published.
