OFT fails to deliver strong action on personal current accounts

The OFT’s announcement today that market change is now delivering improvements in the treatment of customers with personal current accounts, is too weak and will take too long to deliver real improvements. Many customers, particularly the most vulnerable, continue to pay excessive bank charges and this situation has not been effectively resolved.

We will be watching closely to see if the OFT’s expectations of change over the next two years will be met. This is particularly important for those who incur multiple overdraft charges from charges on charges, and interest on charges,

Adam Phillips, Chairman of the Financial Services Consumer Panel said:

"The OFT’s response today is weak. It relies on banks improving themselves, when they have patently failed to do this in other areas in the past – a key driver for the FSA taking over regulation of the deposit taking side of banking was to introduce an explicit and overarching requirement to treat customers fairly which had not been in the previous voluntary Banking Code.

“If the OFT’s proposals do not work, it must deliver on its commitment to make further intervention in the market, including legislation.”

1. The FSA established the independent Financial Services Consumer Panel in December 1998 to advise its Board on the interests and concerns of consumers and to report on the FSA’s performance in meeting its objectives. The Consumer Panel has statutory status.

2. The emphasis of the Panel’s work is on activities that are regulated by the FSA, although it may also look at the impact on consumers of activities outside but related to the FSA’s remit. What we're doing for consumers[1] explains more about the work the Panel is doing.

3. The Consumer Panel brings together a wide range of relevant experience. This includes financial services regulation, working with vulnerable consumers, consumer protection, consumer education, front-line money advice, legal expertise, competition policy, public policy analysis, market research and media.

4. There are currently thirteen members of the Panel as listed below (for further information on individual members, see Who is on the panel)[2]