Which?: Consumers should not pay for banking failures
Peter Vicary-Smith, Which? chief executive, commented on the interim report of the Independent Commission on Banking:
“Today’s report is a step in the right direction. The financial crisis highlighted serious failings in our banking system and we need root to branch reforms to prevent it from happening again. We welcome the intention to ring-fence the retail banking services we rely on every day, but banks mustn’t be allowed wiggle room to avoid fundamental change.
“Banks must be allowed to fail without bringing down the rest of the economy and we must never again be faced with a situation where consumers pay the price for the failures of the banking system.
“Competition on the high street is at an all-time low, with the three biggest retail banking groups consisting of two that would have collapsed without taxpayer support and one that has a woeful record on customer services. This is not the template for a market that works well for consumers.
“The financial crisis has increased the market power of the largest banks, leading to a worse deal for consumers. We’re pleased the commission recognised this, but need to consider whether the recommendations will go far enough to address the parlous state of competition in the UK.”
