FSA proposes new banking rules

28 October 2011

Banks and building societies in the UK are set to have to abide by new regulations in terms of their transactions involving packaged bank accounts.

Research conducted by the Financial Services Authority (FSA) found that around 20 per cent of the British population now have one of these products, which involve a standard bank account with bonus extras such as retail vouchers.

Therefore, the regulator has decided that changes need to be made to the way in which they are sold, meaning that under new proposals, banks will be legally obliged to check whether customers are eligible to claim insurance on these products.

Under the fresh rules put forward by the body - which recently issued a fine of $9.5 million to Credit Suisse UK - financiers will have to establish if a packaged deal is suitable for them.

Sheila Nicoll, FSA director of policy, observed: "We are concerned that it may be too easy at the moment for firms to sell customers something they do not understand or need."

By Tony Aynsley

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