Following a market study the FCA has published an interim report on the effectiveness of competition in the cash savings market. The report, which is based primarily on the analysis of easy access accounts and no-term cash ISA accounts, found that since many consumers do not shop around, banks are able to pay lower interest rates to customers who have stayed with the same account for a number of years. In addition, the largest personal current account providers are able to attract a large proportion of easy-access deposits despite typically offering lower rates.

The FCA will undertake further research before taking a view on whether it should intervene to ensure competition is working in the interests of consumers. As well as considering the feedback to its initial findings, the FCA will consider, among other things:

•  what could be done to ensure that more consumers are aware of the rates they receive and the rates on offer on other accounts;
• whether changes could be made by providers to make it easier for consumers to manage accounts held with multiple providers; and
• whether it is possible to give consumers greater insight into how their interest rate is likely to evolve over time, especially after any introductory offer ends.

The final report will be published in late 2014.

Next steps. The deadline for comments is 8 August 2014.

Copies of the interim report; http://bit.ly/1w5yuy8

associated webpage; http://bit.ly/1nai3Qp

and related press release: http://bit.ly/1naUnHc