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CMA Announces Programme Of Work On Banking

The Competition and Markets Authority (CMA) today announced a short programme of work on banking

Published on 11 March 2014

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by Competition and Markets Authority and Office of Fair Trading


London, England

The Competition and Markets Authority (CMA) today announced a short programme of work on banking, which will lead to a decision on whether or not to make a market investigation reference to be conducted by a CMA panel of independent members.

The CMA will build on the Office of Fair Trading’s (OFT) work in the sector, by concluding the market study into banking for small and medium sized enterprises (SMEs). It will also carry out a short update of the OFT’s 2013 review of personal current accounts.

The Financial Conduct Authority has been working closely with the OFT on the ongoing SME banking market study and will continue to do so with the CMA across this retail banking work programme.

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 consider, as part of the update of the review of personal current accounts, ongoing and planned steps taken in the sector. These include the effect of the introduction of the new seven-day Current Account Switching Service, the impact of the planned divestments by Lloyds Banking Group and by The Royal Bank of Scotland of parts of their retail banking businesses, and the forthcoming establishment of the Payment Systems Regulator.

In taking forward both the market study and the update on personal current accounts, the CMA will be informed by continuing dialogue with the sector, with representatives of SMEs and consumers, and also by work currently undertaken by others, such as the Treasury Select Committee’s inquiry into SME lending. It will also consider any other studies or inquiries that add to the evidence base for its work.

The CMA will publish the findings of its work on both personal current accounts and SME banking during Summer 2014, including its provisional decision on whether or not the statutory criteria for making a market investigation reference are met and, if they are met, whether it would be appropriate for it to exercise its discretion to make a market investigation reference. It will then consult on that provisional decision. Following that consultation, the CMA will then make a final decision on those issues during Autumn 2014.

For more information about this press release visit https://www.gov.uk/government/news/cma-announces-programme-of-work-on-banking



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Posted 2014-03-11 13:43:00