"The reforms we have announced today will shake up retail banking for years to come, and ensure that both personal customers and small businesses get a better deal from their banks."
The wide-ranging package of proposals to tackle competition in the banking sector include a 2018 deadline for mobile banking services to comply with the Open Banking regime, as well as measures to encourage people to switch accounts.
Banks will also have to publish their maximum monthly charges for unarranged overdrafts and deliver better banking services to SMEs by making the prices and availability of lending products more transparent, reducing business owners’ reliance on their personal bank when choosing a bank for their business.
The CMA admitted that it is "well aware of the current barriers to challenger banks in UK retail banking", stating that their inability to highlight to customers how new offerings compare with their current deal is holding them back.
Alasdair Smith, Chair of the retail banking investigation, said: "The reforms we have announced today will shake up retail banking for years to come, and ensure that both personal customers and small businesses get a better deal from their banks.
"We are breaking down the barriers which have made it too easy for established banks to hold on to their customers. Our reforms will increase innovation and competition in a sector whose performance is crucial for the UK economy."
Adam Tyler, chief executive of the NACFB, said that the report is a "giant step in the right direction, but these measures need to be implemented swiftly".
Tyler added: "With the diversity of funding options now available to SMEs, it's staggering that most small business owners turn to their existing bank for finance. There needs to be greater awareness and transparency of the types of funding available to small businesses, beyond the high street.
"Business owners shouldn't see their existing business account provider as their default lender and their only source of finance.
"At a time when the banks are still ultra cautious about who they lend to, there are more lenders than there's ever been in the commercial finance sector who are happy to provide finance to small businesses. It would be a positive message from the Government if they highlighted the alternative funding options that are available."
