In its first review of the current account market since the financial crisis, the Office of Fair Trading found a lack of competition and criticised high street banks for unfair and unclear fees and making it too hard for customers to switch.
Laura Willoughby MBE, Chief Executive of Move Your MoneyÂ campaign said:
“This is a damning report.Â Â Five years on from receiving the biggest taxpayer bailout in history the big banks are still failing to deliver even the most basic of services to their customers.”
Far from an increase in competition, the report also found that take-overs and mergers mean the big banks had increased their market share since 2008.Â However the report pointed to evidence that things were starting to change with switching rates increasing by nearly a third over the last year and an increase in the market share of mutuals such as Nationwide, a trend that will continue with the expansion of the Cooperative Bank.
The OFT highlighted that personal current accounts are critical to the efficient functioning ofÂ the UK economy.
Laura WilloughbyÂ continued
“In the chaos of the financial crisis big banks swallowed smaller providers using cheap taxpayer money, giving them an ever tightening stranglehold over customers and the UK economy.
“Anger at the big banks is turning into action.Â Â Over 500,000 people moved their money out of the big banks early in 2012 alone and, with the Government forcing banks to make switching easier later this year, 14m customers have indicated they will find a better bankÂ 5.
“This problem isn’t going away, the hailstorm of scandals from Libor to mis-selling and money laundering is ravaging the reputation of British banks.Â People have had enough and are moving their money to banks which are more transparent and play fair with their customers and the economy.”
The OFT report comes following new evidence that senior executives at Barclays knew of Libor manipulation long before they had previously admitted.Â Laura WilloughbyÂ commented:
“This only goes to show that real change will only come from below, not the board room. If senior bankers knew about the manipulation of libor then they need to be held to account.Â Â How can banks like Barclays ask customers to trust them again, if they refuse to come clean first?”