The regulator said fresh measures, outlined this morning, would make changing accounts quicker and easier, following a probe which found the £700bn sector had failed to work as effectively as it could.
A series of new rules that will force firms to provide clear information on the interest rates on their cash savings products have been put forward today.
The FCA wants seven day switching for the vast majority of cash ISA transfers to be available from January 2017.
The FCA summarised its measures as including:
· Removing complex jargon and helping customers understand their options. Firms to provide consumers with easy-to-understand key information to help them compare savings accounts. The design and content of these proposed summary boxes have been informed by independent consumer research.
· Being clear on what interest consumers are getting. Firms to be told to make interest rate information more easily accessible, including alerting consumers more actively to changes in interest rates, the expiry of a bonus rate or maturity of a fixed-term account, for example by text message.
· Quicker and easier switching. Introducing a new rule which requires firms to provide a prompt and efficient service so that a customer can switch to a better account offered by the same firm. Firms told to seek to make use of the identity information and documents they already hold about existing customers and may wish to provide simple switching processes for customers using online or mobile banking.
· Seven day switching for cash ISAs (except for those involving the very smallest providers) from January 2017.
· Making it clear which firms pay the lowest rates. The FCA will publish information in order to highlight firms who pay poor interest rates to longstanding customers.
The FCA is seeking feedback on these proposals and is expected to confirm finalised rules later this year. The consultation ends on 2 October and it intends for the rules to come into force in 2016.