Facilitating current account switching

From November 1, consumers in Malta and in all other EU member states should find it easier to switch their current account (cheque book facility) from one bank to another within their own member state.

All banks in the EU, including Maltese banks, have adopted a set of 'Common Principles for Bank Account Switching', prepared by the European Banking Industry Committee and endorsed by the European Commission.

Essentially, these principles apply to situations where personal customers would like to transfer their current account to another bank within the same country.

The common principles set clear timeframes for the old and new bank and put the onus on these banks to support the customer's request to switch accounts and offer assistance by making the necessary arrangements to enable smooth and timely switching.

According to the principles, if a consumer wishes to change bank, the new bank will act as the primary contact point and offer its assistance throughout the switching process. It will deal with the old bank, ensuring that the transfer of the consumer's recurrent payments, such as direct debits and standing orders, is done smoothly and rapidly.

The new bank will assist the consumer in closing the old account and transferring the remaining balance to the new account. It will reinstall the customer's recurrent payments on the new account and will either inform the third parties about the new account details or assist customers in doing so. It will also assist consumers in requesting the old bank to close their old account and transfer the remaining balance.

The old bank will generally not charge the consumer for providing standard information about the consumer's recurrent payments.

At national level, these principles will be coordinated by the Malta Bankers' Association.

The Consumer Complaints Unit within the Malta Financial Services Authority (MFSA) will be liaising with customers who might have a complaint about participating banks' compliance with these principles.

More information about these principles, together with a copy of the Common Principles may be obtained from any local commercial bank branch or website.

They are also available from the MFSA's Consumer Complaints Unit site at www.mfsa.com.mt/Consumer/bank-switch.htm.

This information has been provided by Anna Cutajar Paris, manager, Consumer Complaints Unit, MFSA.

MFSA Freephone: 80074924

Consumerinfo@mfsa.com.mt