Bank reforms to be announced by Queen

16/11/2009

A new financial services bill is to ban credit card cheques in order to protect vulnerable consumers from unsustainable debt.

The reforms, which could enter UK law in 2010, are set to be announced during the Queen's speech.

Banks are also to face tougher regulations as a result of the bill, including measures which could restrict excessive pay for senior staff.

As well as the ban on credit card cheques, which can encourage customers to borrow more than they can pay back, the bill is to contain provision for a new consumer education service.

This organisation would, it is hoped, result in customers becoming more informed about the potential effects of taking out financial products and services from banks.

More generally, the business activities of financial services firms have been blamed by some analysts for helping to bring about the credit crunch.

Responding to the possible Queen's speech proposals, the British Bankers' Association (BBA) warned that any actions which set the UK at a "disadvantage" could lead to job losses and damage to the economy as a whole.

"British banking is [a] global business and many of our banks operate outside the UK," the BBA said.

"Moves to bind how our banks operate overseas could put the industry at a serious disadvantage and also discourage global banks from coming to the UK. This would be a major problem for jobs, the taxpayer and the wider economy as well as bad for business."

The Queen's speech is to be delivered on November 18th.

Tags; Income Worries and Debt, Recent Graduate Debt, Young Family Finances, Retirement Money Problems, Credit Card Lifestyle,

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