Bank switching costs targeted

Finance Minister Michael Noonan has said the Government is working on reducing bank switching costs to make it easier for consumers to move between banks, boost competition in the sector, and make individual institutions work harder to retain existing customers.

Mr Noonan said his department is in “regular dialogue” with potential market entrants, and the Government will be supportive of new entrants “as they emerge”.

His comments were contained in a wide-reaching written response to Fianna Fáil’s finance spokesperson, Michael McGrath, who asked the minister why no specific lending targets had been put in place for the main banks for 2014.

As part of the 2011 bank recapitalisation programme, the Government imposed SME lending targets on AIB and Bank of Ireland for three calendar years.

But instead of a headline target being set for this year, the banks are to begin providing additional SME-focused lending data to the Department of Finance on a monthly basis.

Mr Noonan said: “The focus now needs to shift towards the collation and examination, on a monthly basis, of more granular data on the funding of the activities of SMEs from both AIB and Bank of Ireland, the wider banking sector and, increasingly, the non-bank funding sector.”