In May, the Commission proposed new measures to enable Europeans to open and switch bank accounts more easily and see what fees they are being charged.
The proposed Directive would smoothen the process involved in switching bank accounts. Payment service providers – mainly banks – would need to complete the procedure within 30 days and at no cost, according to the plans.
The draft law would also oblige banks to spell out their charges in a standardised way, making it easier for customers to compare services with other banks, and to provide consumers with adequate information on their right to switch bank accounts and the process involved.
An unnecessary right?
The proposals also suggest giving citizens the legal entitlement to open an account.
“We see that there is value in harmonising standards to ensure that all EU consumers can expect the same standards of banking service, however we do not believe that it is necessary to ensure that there are uniform provisions for consumers to switch bank accounts cross-border,” Eric Leenders, the chairman of the consumers affairs committee at the European Banking Federation (EBF), told EurActiv in an interview.
The EBF represents national banking associations in 31 countries, covering more than 4,500 banks with 2.5 million employees.
Leenders, who is also the executive director of retail at the British Bankers' Association, said that the EBF recognised that “to support labour mobility it is important that consumers can open accounts cross- border”. He said that “the market already operates more effectively than it is being given credit for”, however.
A challenging, disproportionate measure
Leenders said there should be a clear distinction drawn between accounts opened for reasons of economic migrants and for reasons of social inclusion. He said the latter “is very much for individual member states to consider given that these issues are the responsibility of individual member states.”
Implementing the Commission’s plans would be “challenging and disproportionate, especially given the lack of demand - to provide cross-border switching because of the very complex infrastructure required within the banks,” Leenders said.
The proposal is currently being considered by the European Parliament.