Britain to probe $5.2-billion 'rip-off' of telecoms, financial customers
FCA announces market probe into car, home insurance; banking body says industry has already made changes
FCA announces market probe into car, home insurance; banking body says industry has already made changes. PHOTO:FILE
LONDON:
Telecoms and financial services companies face an investigation by Britain's competition regulator after consumer body Citizens Advice complained that customers who do not switch providers were being "ripped off".
Such customers were being overcharged 4.1 billion pounds ($5.2 billion) a year, the charity said on Friday and asked the Competition and Markets Authority (CMA) to tackle this. "The practice of overcharging loyal customers is widespread and Citizens Advice has repeatedly warned that loyal consumers are being ripped off," its Chief Executive Gillian Guy said.
Citizens Advice submitted a so-called super complaint, which the government defines as raising "any feature, or combination of features" of a market for goods or services which "appears to be significantly harming the interests of consumers". The CMA said it would consider the concerns raised and what should be done about them.
This will include engagement with relevant regulators such as the Financial Conduct Authority (FCA) and Ofcom. It will publish a response within 90 days. The competition regulator said possible outcomes include recommendations to change legislation, action by sectoral regulators and competition or consumer enforcement action.
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Citizens Advice said its research had found that eight in ten people were paying a significantly higher price, in at least one of the markets, for remaining with their existing supplier. "As a result of this super-complaint, the CMA should come up with concrete measures to end this systematic scam," Guy said.
Important issues
The FCA said it has been concerned for some time about the issue of long-standing customers being charged more for some products than new ones. The financial watchdog said it would launch a market study into how general insurance firms charge their customers for home and motor insurance. "Citizens Advice have raised a number of important issues and we will work closely with the CMA as they investigate this super-complaint," FCA Chief Executive Andrew Bailey said.
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The FCA said it was already looking at the savings and mortgages market. UK Finance, which represents banks, said the industry has already made changes to improve competition in mortgages and savings markets, including helping longstanding borrowers switch to a better deal.
The super-complaint is the fourth the charity has made since being given the power in 2002. It said its complaint on payment protection insurance (PPI) in 2005 has helped customers receive 32.2 billion pounds in refunds and compensation so far.
Telecoms and financial services companies face an investigation by Britain's competition regulator after consumer body Citizens Advice complained that customers who do not switch providers were being "ripped off".
Such customers were being overcharged 4.1 billion pounds ($5.2 billion) a year, the charity said on Friday and asked the Competition and Markets Authority (CMA) to tackle this. "The practice of overcharging loyal customers is widespread and Citizens Advice has repeatedly warned that loyal consumers are being ripped off," its Chief Executive Gillian Guy said.
Citizens Advice submitted a so-called super complaint, which the government defines as raising "any feature, or combination of features" of a market for goods or services which "appears to be significantly harming the interests of consumers". The CMA said it would consider the concerns raised and what should be done about them.
This will include engagement with relevant regulators such as the Financial Conduct Authority (FCA) and Ofcom. It will publish a response within 90 days. The competition regulator said possible outcomes include recommendations to change legislation, action by sectoral regulators and competition or consumer enforcement action.
UK govt 'agrees not to favour EU workers after Brexit'
Citizens Advice said its research had found that eight in ten people were paying a significantly higher price, in at least one of the markets, for remaining with their existing supplier. "As a result of this super-complaint, the CMA should come up with concrete measures to end this systematic scam," Guy said.
Important issues
The FCA said it has been concerned for some time about the issue of long-standing customers being charged more for some products than new ones. The financial watchdog said it would launch a market study into how general insurance firms charge their customers for home and motor insurance. "Citizens Advice have raised a number of important issues and we will work closely with the CMA as they investigate this super-complaint," FCA Chief Executive Andrew Bailey said.
Telecom remains biggest source of revenue for Punjab
The FCA said it was already looking at the savings and mortgages market. UK Finance, which represents banks, said the industry has already made changes to improve competition in mortgages and savings markets, including helping longstanding borrowers switch to a better deal.
The super-complaint is the fourth the charity has made since being given the power in 2002. It said its complaint on payment protection insurance (PPI) in 2005 has helped customers receive 32.2 billion pounds in refunds and compensation so far.