LONDON, July 21 (Reuters) - Britain’s competition watchdog should take a hard line and be prepared to shake up the banking industry to improve services for customers, a leading lawmaker said on Monday, saying he was fed up with years of inaction.
“There are millions of banking customers who feel they have had a raw deal, and we’re hoping you can do something about it,” said Andrew Tyrie, chairman of the the Treasury Select Committee cross-party panel of lawmakers.
Tyrie’s panel was quizzing officials from the Competition and Markets Authority (CMA), which said on Friday it is likely to launch an in-depth investigation later this year into bank services for small business customers and personal accounts because of a lack of competition.
The CMA took over as Britain’s independent competition watchdog in April and its review of banking would add to several other reviews in the last 15 years, which Tyrie said had failed to shake-up the industry as required.
“This (lack of competition) has been evident for years, for decades, and we’ve finally had enough and we want to see some action,” he said.
CMA Chief Executive Alex Chisholm said his organisation had a number of tools at its disposal, which could potentially see it improve competition where other attempts have failed. He said new technology should also help, and allow greater price comparison.
Chisholm said a successful and competitive market is driven by banks’ need to improve services “because if they don’t do a better job then their customers will go elsewhere,” rather than because they have been told to do so.
The CMA has the power to order a break up of banks considered too dominant, as well as so-called behavioural remedies, such as improving information given to customers. The CMA will decide in autumn whether to launch the full investigation, which would take about 18 months. (Reporting by Steve Slater, editing by Louise Heavens)