Topic 2- Competition In The Financial Services Sector Flashcards
1
Q
What is good competition?
A
Where there’s a variety of providers on the market from which consumers can choose.
Products are well designed and meet customer needs
The provider doesn’t sell the customer the product unless it is financially sustainable to the customer
2
Q
What is bad competition?
A
This is where there are few providers who are large and powerful. They online aim to maximise their sales; not to benefit or ensure that the customer is financially stable to manage the product
3
Q
What should savers consider?
A
- Whether there’s any minimum deposit that’s required
- Amount of time interest is at that rate
- Whether any regular deposits have to be made
- Whether tax will be deducted or not
4
Q
Who are Save our Savers?
A
A pressure group that believes that savers must be supported and rewarded for saving
- Devaluation of savings through inflation
- Low interest rates
- Unfair legislation and taxation
5
Q
How can competition be increased?
A
- Encouraging challenger banks and reducing barrier entries
- Consumer choice and current accounts
- Regulation
