10th January 2020

UK Finance comments on the FCA consultation on easy access cash savings accounts

Commenting on the Financial Conduct Authority's(FCA) consultation paper on Introducing a Single Easy Access Rate for cash savings, Eric Leenders, managing director, Personal Finance at UK Finance, comments “The banking and finance industry has already implemented a number of remedies to improve competition in the cash savings market, helping savers to shop around and find the best possible deal. These include communicating more clearly with customers about the rates they receive, faster Cash ISA transfers and enhanced customer prompts before a rate is reduced.

Banking business depends on there being an adequate margin between what a provider pays for its deposit funding and what it charges for the loans it makes available. Regulatory intervention that increases the overall cost of deposit funding for providers will, in general, result in providers having to raise the cost of loans they make available to house purchasers and other borrowers.

UK Finance and its members will consider these proposals carefully and will continue to work closely with the FCA to ensure fair outcomes for all customers, including those in vulnerable circumstances and borrowers, whilst avoiding unintended consequences impacting innovation and competition in the cash savings market.”