Government launches banking competition inquiry

The Treasury Committee has announced the launch of an inquiry into competition in the banking sector.

The committee will look at how the financial crisis has changed the shape of the sector and how consolidation among banks and building societies has affected competition and choice.

It will examine whether competition is inhibited by difficulties faced by customers in accessing information about products, explore the government strategy to increase competition and consider the relationship between competition and financial stability.

It will also consider the effect of free banking on effective competition and look at the role of foreign-based operators and whether they are likely to return to the UK.

The Office of Fair Trading is already looking into unauthorised overdraft charges and equity underwriting and the government has appointed an Independent Commission on Banking.

The deadline for submissions is Monday 6 September.