OFT said that the provisional decision would boost competition to provide essential banking services to small business customers
The Competition Commission (CC) has published its provisional decision to lift the temporary price controls imposed in 2003 on the UK's four largest banks servicing small and medium-sized enterprises (SMEs).
The UK’s Office of Fair Trading (OFT) welcomed the CC’s provisional decision.
The OFT said that the provisional decision would boost competition to provide essential banking services to small business customers.
The OFT's 2002 review noted concerns around low levels of switching in the market, and a lack of price transparency for customers.
The CC said that the requirement on the banks to publicize changes in charges will be retained. The behavioural undertakings designed to make the market more competitive by making switching easier and prices more transparent and by prohibiting the bundling of different products and services will remain in place.
John Fingleton, Chief Executive of the OFT, said: 'This is an important step in the development of further competition in the business banking sector. It will allow banks greater freedom to innovate and compete for customers, and will be most beneficial for those prepared to consider switching their banking service provider. The OFT will continue actively to monitor the market in future, and ensure the banks comply with their undertakings on switching and price transparency. If we find that competition is not working well for SMEs, we will consider further action.'