The Fairbanking Foundation, a charity in the UK, has been granted formal accreditation by the UK Accreditation Service (UKAS) to become the UK’s first certification body for retail financial products. The certificate was awarded in a ceremony yesterday at Parliament’s House of Lords in London, and means that the Fairbanking Foundation has met UKAS’ internationally recognised standards to demonstrate its competence, impartiality and performance capability as a product certification body.
The body intends to use its certification to mark UK retail bank product offerings, on a scale of three to five, to encourage better standards and discourage sharp practices such as the payment protection insurance (PPI) mis-selling scandal which was supposed to protect people’s income if they lost their jobs but rarely paid out and has since cost UK banks tens of billions of pounds in compensation.
According to Antony Elliott chief executive of The Fairbanking Foundation, the body is delighteds to be recognised, adding that: “The Fairbanking Mark was devised to help the Foundation achieve its charitable objective; to encourage banking providers to improve the financial well-being of their customers. By creating an accredited certification scheme that formally evidences and makes public the extent to which a banking product helps customers manage their money and reach financial goals, the Foundation has done just that.”
The UK Fairbanking Mark initiative has been designed to encourage and facilitate the wider availability and higher public profile of retail banking products that can make a significant improvement to the financial well-being of the customer.
The scheme grants those products submitted that are successful with a 3, 4 or 5 star rating, indicating the level to which they have been assessed to help improve the customer’s financial well-being. Each product is tested against a range of relevant criteria which have been derived from extensive customer research and the application of academic behavioural theory as being critical to the improvement of financial well-being. A crucial part of the testing is independent research carried out with a significant number of existing users of the product to ensure that the product’s relevant features have indeed been sufficiently effective.
Five products have already been through the Fairbanking Mark scheme and have succeeded in gaining a Fairbanking Mark since the scheme was first established in 2011, including two current accounts without an overdraft, a current account with an overdraft and two savings accounts, although none yet has attained a five star rating.
Four high-profile patrons of Fairbanking were added to the Foundation’s steering committee yesterday as well, including two from the UK Banking Commission: The Archbishop of Canterbury, Justin Welby, The Archbishop of Westminster and Lord McFall join the group, alongside Vincent Nichols and Dr Anthony Seldon.