Brussels - The European Commission will
propose new rules to make it easier for consumers to open and switch bank
accounts, as well as see what banking fees they are being
charged.
The proposal, to be published on
Wednesday and which could become law in the European Union in three years, also
requires banks to shoulder the administrative burden when clients switch
accounts, such as transferring direct
debits.
Officials with knowledge of the
draft law said it would also oblige banks to spell out their charges in a
standardised way, making it easier for customers to
compare.
The Commission wants at least one
bank in each country to offer a basic account, allowing people currently
outside the banking system to deposit cash and pay
bills.
The EU executive will also suggest
giving citizens the legal entitlement to open an account, acting out of a
growing sense of frustration that efforts to cajole banks into better
self-regulation is not working.
Studies by
Commission officials showed that banks did not offer enough information on
switching accounts and that consumers did not know what fees they paid for
banking services.
The studies also found
that 58 million citizens in Europe had no bank accounts - including half the
populations of Bulgaria and Romania.
The
Commission hopes introducing a standard guide to fees for people opening an
account, as well as an annual summary of charges and establishing a national
comparison website will change this.
Under
the new rules, consumers wanting to switch banks would only have to inform the
new bank, which would then be obliged to tell gas, electricity and other
providers of the changes to account payments.
The proposal will go to EU member states for their approval or possible change
before the changes can be introduced.