UK to monitor bank communication with customers to ensure fairness
LONDON, Oct 28 (Reuters) – Britain’s financial watchdog will start regulating lenders’ day-to-day contact with their customers to ensure services such as direct debits, payments, interest change notifications and savings accounts are fair.
Spurred on by new European rules on instant access and current accounts that come into effect this weekend and negate chunks of the UK’s two voluntary banking codes, the Financial Services Authority (FSA) published its new banking code of conduct on Wednesday.
The combined rules include giving current and instant access account customers at least two months’ notice before imposing disadvantageous interest rate changes and ensuring lenders refund any transactions customers say are unauthorised.
Banks will also have to provide evidence to justify, or refund, any debits from customers’ credit or debit cards that is more than customers “could reasonably have expected”. Refunds should be made within 10 days.
Building societies and banks will no longer able to delay giving prospective customers full details about products until they had signed up to them, and from next February they will have to pay interest on money transferred into all customer accounts from the moment funds are received.
“If firms fall short of these standards or fail to treat their customers fairly, the FSA will take action,” warned Dan Waters, its director of conduct risk.
“New regulations will put banking customers in the driving seat by setting down clear standards that people can expect … like speeding up payments between accounts, adequate notice of changes in terms and conditions and smoothing the procedure for querying an unauthorised or unexpected transaction,” he said.
(Reporting by Kirstin Ridley, editing by Will Waterman)
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