A committee of MPs is to examine whether vulnerable consumers are being treated fairly by banks and service providers.
Among other things the Treasury Committee will look at what banks are doing to stop financial exclusion.
It will also examine whether some vulnerable people are being overcharged for travel insurance.
Citizens Advice has claimed that people are losing as much as £877 a year each, because they are loyal customers.
As a result, the Financial Conduct Authority (FCA) and the Competition and Markets Authority (CMA) are already looking at whether some people are being over-charged for financial products.
- Consumer loyalty ‘rip-off’
- Loyal customers pay £75 too much
“With customers expected to take more responsibility for their financial planning and resilience, bank branches closing, and the number of free-to-use ATMs falling, it’s becoming increasingly difficult for vulnerable customers to access certain financial services,” said Nicky Morgan, chair of the Treasury Committee.
The enquiry will also consider:
- how financial firms define “vulnerability”
- whether firms should have to have a legal duty of care to their customers
- which customers suffer most when a bank branch closes
- how Post Offices are filling the gap after a bank branch closure
Tom Selby, a senior analyst with the investment platform AJ Bell, said there was no easy answer to improve the situation.
“Although there are some customers who may more obviously be vulnerable, such as those diagnosed with Alzheimer’s, anyone can potentially become vulnerable at any time.
“Furthermore, it is not always obvious when someone is vulnerable. Many people suffer for long periods with debilitating depression, for example, without even their closest family knowing,” he said.