LONDON (Reuters) - New rules making it easier for Britons to switch banks resulted in a 16 percent increase in the number of customers moving accounts in the first half of 2014, the body overseeing the system said on Wednesday.
The new rules, introduced last October, ensure customers can switch accounts within seven working days, with all outgoing and incoming payments automatically transferred.
They are part of a range of measures designed to break the dominance of Britain’s five biggest banks - Lloyds Banking Group, Royal Bank of Scotland, Barclays, HSBC and Santander UK - which provide more than three-quarter of all UK personal current or checking accounts.
“Competition is growing as existing providers are upping their offerings and challenger banks are competing to attract new customers,” said Adrian Kamellard, chief executive of the Payments Council.
However, Richard Lloyd of consumer group Which? said the rate of switching was not yet enough to transform the market and called upon Britain’s new competition body to take a closer look at the industry.
The Competition and Markets Authority will publish the findings of a preliminary investigation on Friday and may recommend a full-blown inquiry into the sector.
The Payments Council, which is responsible for the account switching service, said 592,695 accounts had been moved in the six months to the end of June, compared with 511,139 in the same period the year before.
The council said in April there had been a 14 percent rise in the six months since the rules were introduced.
Reporting by Matt Scuffham; Editing by David Holmes