Competition in the £700bn cash savings market often does not work well for consumers, particularly those with long-standing accounts, the Financial Conduct Authority (FCA) has found, as it reveals plans to overhaul how the industry works.
The regulator said it should be easier for consumers to compare cash savings accounts and then switch providers - mainly banks - if they wish. In particular, the FCA found around £160bn of the funds held in easy access savings accounts earned an interest rate equal to or lower than the Bank of England base rate of 0.5% in 2013, yet consumers often find it difficult to know what rate they are on, or are put off switching by the expected inconvenience. Around 80% of easy access accounts have not been switched in the last three years, according to the FCA. Research by the regulator also ...
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