The FCA has published:
- Cash Savings Market Report; and
- Occasional Paper No.7: Stimulating interest: Reminding savers to act when rates decrease.
In the Cash Savings Market Report the FCA sets out the final findings of its cash savings market study and its proposed remedies. The FCA found that the cash savings market is not working well for many consumers. In particular, it found that some consumers are put off from switching their account by the expected hassle and perceived low gains from opening another account. It also found that some providers need to improve the transparency of their practices as little information is currently being given to consumers about alternative products.
The FCA proposes remedies in four main areas:
- giving consumers sufficiently clear and targeted information at the right time so that they can easily and quickly compare their savings accounts with alternative ones and know how to switch if they want to do so;
- making the switching process as easy as possible so that it does not put consumers off moving their money to another savings provider or to another savings account with the same provider;
- removing some of the advantages of the large providers by making it easier for firms to provide a way for consumers to view and manage accounts with different providers in one place; and
- being more transparent about the way in which providers are reducing interest rates on variable rate savings accounts the longer a consumer holds the account.
The deadline for comments on the proposed remedies is 18 February 2015.
The Occasional Paper that the FCA has published notes that following research there is an indication that improved disclosure can encourage consumers to act when it is beneficial to do so.
View Consumers with cash savings need better information and easier switching says FCA, 20 January 2015