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UK: Market regulators find savings account market uncompetitive

By  |  January 20, 2015
UK: Market regulators find savings account market uncompetitive

Britain’s Financial Conduct Authority (FCA) is asking banks to be more transparent with the rates they offer for savings accounts and to clearly communicate changes. This request comes with the FCA revealing that competition in the cash savings market “often does not work well,” with $242 billion held in savings accounts with interest rates equal to or lower than the Bank of England’s base rate of .5 percent.

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    The FCA wants to loosen the hold of the four largest lenders: Barclays Plc, HSBC Holdings Plc, Lloyds Banking Group Plc and Royal Bank of Scotland. The four entities hold more that 75 percent of the $1.1 trillion market. Christopher Woolard, director of strategy and competition at the FCA, said, “Firms should be competing to offer the best possible deal and consumers should have the information they need to help them shop around.”

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