The UK Government has proposed a new plan that would see RBS fund and deliver a series of initiatives to boost competition in UK’s business banking market.
The proposal was put forward by HM Treasury in agreement with RBS, which is assigned to help small and medium businesses and enterprises benefit from greater choice in the banking systems that are currently available.
According to the UK Government, the proposed package includes:
- A fund, administered by an independent body, that eligible challenger banks can access to increase their business banking capabilities
- Funding for eligible challenger banks to help them incentivise SMEs to switch their accounts from RBS paid in the form of “dowries” to challenger banks to use to incentivise switching
- RBS granting business customers of eligible challenger banks access to its branch network for cash and cheque handling, to support the measures above
- An independent fund to invest in fintech to support the business banking of the future
The estimated upfront cost is expected to be around £750m, and other large incumbent banks such as HSBC and Barclays are said not to be eligible to benefit from the proposal.
“This new plan provides a clear blueprint to increase competition in the UK’s business banking market, and would help RBS resolve one of its most significant legacy issues which has held back the sale of the taxpayers’ stake.” a HMT spokesperson commented.
Whitepapers
Related reading
2020 hailed “year of contactless” by payments study
By Richard Young The coronavirus crisis has caused a surge in mobile and contactless payments, driving consumers to make fewer but larger ... read more
Redefining remittances: Fintechs during coronavirus
By Daumantas Dvilinskas, CEO and co-founder, TransferGo According to new projections by the World Bank, remittances are set to decline by as ... read more
Crypto’s safe-haven status wavers amidst market crash
Perceptions that cryptocurrency performs autonomously from other markets is being questioned as bitcoin crashed by 50 percent on March 12. Market participants ... read more
COVID-19: our action plan
Dear reader, As the coronavirus pandemic spreads, we continue to hear and read unsettling stories from around the globe. At Payment Eye, ... read more
