New proposals to make comparing current accounts easier
Comparing business current accounts could be made much simpler for business owners if new rules being proposed by the Financial Conduct Authority (FCA) get the go ahead.
In July, the FCA launched proposals designed to help customers make effective comparisons of the service levels available for both business and personal current accounts.
The regulator proposes to require firms who offer personal current accounts and business current accounts to publish service information about:
- how long it takes to open an account and have features of the account working, including overdraft facilities
- how long it takes to replace a lost, stolen or stopped debit card
- how long it takes to give someone access to a personal current account under a power of attorney
- how and when customers can carry out various transactions, including making payments or cancelling a cheque, and whether 24-hour help is available, and
- the number and type of major operational or security incidents
It is hoped that by forcing current account providers to publish relevant information on service and performance it will be easier for consumers to compare providers and it will also encourage increased competition between firms to offer improvements in service quality.
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Christopher Woolard, Executive Director of Strategy and Competition at the FCA, believes that small businesses are really interested to know about the service their bank or building society offers compared to other firms, but are currently discouraged from looking for current accounts offering better performance because they think that “all banks are the same”.
He said: “These proposals represent a step forward, making it easier for consumers to judge whether their bank is offering good service and for firms to see if they are competing effectively against other providers.”
It is proposed that performance should be measured quarterly (beginning in April 2018) and published within six weeks of the end of the quarter, and that standing information about service availability should be published and kept up to date.
Firms should publish this information on their website and also make the information available for use by comparison services.
Firms that are part of the Open Banking initiative will also have to make this information available via an application programming interface (API).
Have your say
Comments on the proposals are invited until 25th September 2017 and, dependent on the outcome of discussions, the FCA aims for the first publication of the information in August 2018.
This will coincide with the first publication of the other service indicators that the Competition and Markets Authority is requiring the largest current account providers to publish.
This is likely to be welcome news for many business owners who currently find it difficult to compare business bank accounts and could be missing out on much better deals and service as a result.
What do you think? Will these proposals encourage you to compare current accounts? Let us know in the comments below.