Unit 2 Flashcards
Effective competition
providers try to give best product rather then manipulate consumers for profit
good comp v bad comp
good - no of providers that offer good products for consumer choice
bad - few large providers with little differentiation focus on sales
PPI
mis-sold in 2000s, billions paid out
covers loans if ill many felt pressured or didn’t understand
Wasteful comp
providers spend alot of products that only differ slightly
e.g RBS has four current accounts
Product complexity
products too complicated for consumers to understand
Pressure groups
a group that come together to try make change
Financial services consumer panel is a voice for people that research pension scams
concentration ratio
UK high concentration
2014 85% of current account by big 5
Barriers to entry
features of market that make it hard for new firms to start
e.g, regulation
Genuine comp
several providers with different products that suit consumers
Lloyds v metro
L - over 2000 branches
m - 75
customer interia
consumers reluctant to change provider
Current account switch service
September 2013, 7 day switch of account
