TSB lambasts competition watchdog for failing to fix "broken" banking market

The UK bank says the watchdog's nearly three year long investigation into competition in retail banking seems to have "backfired", with fewer consumers switching banks than before it intervened.

In the past 12 months since the publication of the CMA's final report, the number of people using the Current Account Switching Service (Cass) has fallen by 14%.

Research undertaken by TSB indicates that only 28% of people have heard of Cass, directly contradicting the 75% customer awareness figure which CASS recently trumpeted.

"The CMA’s attempt to fix the industry and get consumers a better deal has failed and banking is still not working in the interest of consumers," says TSB. "The big banks continue to have a stranglehold on the market - they are taking customers for granted, trapping them on poor deals and making it impossible to switch."

Nor does the bank hold out much hope for a shake-up in the market from the introduction of open APIs, accusing the incumbents of dragging their feet and pointing to its own research which shows that only two percent of people have heard of the concept.

The bank is calling on the CMA to toughen its stance, urging the authority to enforce the introduction of monthly bills, showing the true cost of consumer banking services, and 'credit passports' which customers can take to their new bank to ease the pain of making a switch.

“The CMA had a golden opportunity to fix the industry, by enabling consumers to make informed choices about their banking and ultimately putting them in control. But one year on and its attempt to get consumers a better deal has failed," says TSB chief Paul Pester. “In a truly competitive market, consumers will be offered genuine choice and a level of transparency they’ve never seen before, so they can make informed choices and switch with ease. Only then will consumers be empowered to vote with their feet and get a better deal."