This week, EU competition commissioner Neelie Kroes has set in motion profound changes to the UK banking system. As a result of her decree, the big boys – Lloyds Banking Group and RBS – which have been in receipt of so much of our money will be broken up. For much the same reason, the more specialised Northern Rock is being split into a “good” and “bad” bank, with the good part being speedily returned to the private sector.
The net result will be transformation of our high street banks. Three new banks will come on the scene, accounting for about 15% of the market, and they will not be owned by any of the Big Five that currently dominate our system.
That means more competition. But there are other reasons for predicting a better deal for consumers – and better career opportunities for marketers – over the next five years. Shorn of the cartel power that goes with being a part of a global bancassurance operation, retail banks will have to fight harder for their funds. And there’s only one place they’re going to be getting them: from you and me. That means more customer focus, and more scope for marketing ingenuity.
More in my column this week.