The UK Competition Commission has released a proposal outlining a final remedies package designed to increase competition in the market for personal current account banking services in Northern Ireland, which should prove beneficial to Northern Irish banking customers.
The proposal includes changes that will simplify the structure of bank charges and reduce confusion among bank customers, which the regulatory body found to have caused customers to become reluctant to switch providers, and therefore restricting competition in the market. These features make it likely that customers incur higher charges and receive lower levels of credit interest than they might expect in a more competitive market.
Under the new proposal, banks must conform to a number of modified requirements. These include the use of easy-to-understand descriptions of personal current account services, a clear explanation on the levels of charges and interest rates and how and when they are applied, and to provide information on statements including details on charges and interest rates.
The financial institutions must also provide each customer with an annual summary of charges and interest payments and send an annual reminder to customers about their right to close their account or switch it to another bank.
The organization expects to publish its final report, including its final decisions on remedies, in May 2007 and is open to feedback on its current outlined proposal.