Citizens Advice responds to the FCA’s move on the loyalty penalty

Today the Financial Conduct Authority has announced a discussion paper on the loyalty penalty people pay in the savings market.

Gillian Guy, Chief Executive of Citizens Advice, said:

“We welcome the FCA’s move to address the loyalty penalty people pay on their savings.

“Our research shows on average consumers can pay £48 per year if they do not switch their savings accounts.

“We’ve long called for the loyalty penalty to end across essential markets and action from regulators to protect consumers, particularly those who are vulnerable.

“It is no longer acceptable to charge loyal customers more. Strong action has been taken in the energy market with the recent price cap. The FCA’s move shows exploiting loyalty isn’t acceptable in savings either. It’s now time for action in other markets to end this practice.”

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Notes to editors

1. This refers to the loyalty penalty for cash ISAs. Given the range of different savings accounts available, this report focuses on cash ISAs because they are a type of savings account that many people have and about which there is robust data.

2. Citizens Advice is made up of a network of local Citizens Advice in England and Wales, all of which are independent charities, the Citizens Advice consumer service and the national charity Citizens Advice.

3. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers.

4. Citizens Advice is the statutory consumer advocate for energy and postal markets. We provide supplier performance information to consumers and policy analysis to decision makers.

5. The Citizens Advice Witness Service provides free and independent support for both prosecution and defence witnesses in every criminal court in England and Wales.

6. Citizens Advice also offers Pension Wise appointments at 500 locations across England and Wales.

7. The advice provided by the Citizens Advice service is free, independent, confidential and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality.

8. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.

9. Last year we helped over 2.7 million people face to face, by phone, email or web chat. For full service statistics see our monthly publication Advice trends.

10. Citizens Advice service staff are supported by more than 23,000 trained volunteers, working at over 2,500 service outlets across England and Wales.

1. This refers to the loyalty penalty for cash ISAs. Given the range of different savings accounts available, this report focuses on cash ISAs because they are a type of savings account that many people have and about which there is robust data.

2. Citizens Advice is made up of a network of local Citizens Advice in England and Wales, all of which are independent charities, the Citizens Advice consumer service and the national charity Citizens Advice.

3. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers.

4. Citizens Advice is the statutory consumer advocate for energy and postal markets. We provide supplier performance information to consumers and policy analysis to decision makers.

5. The Citizens Advice Witness Service provides free and independent support for both prosecution and defence witnesses in every criminal court in England and Wales.

6. Citizens Advice also offers Pension Wise appointments at 500 locations across England and Wales.

7. The advice provided by the Citizens Advice service is free, independent, confidential and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality.

8. To get advice online or find your local Citizens Advice in England and Wales, visit citizensadvice.org.uk

9. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.

10. Last year we helped over 2.7 million people face to face, by phone, email or web chat. For full service statistics see our monthly publication Advice trends.

11. Citizens Advice service staff are supported by more than 23,000 trained volunteers, working at over 2,500 service outlets across England and Wales.