Lloyds TSB halts sale of packaged accounts in branches
Lloyds TSB will stop selling packaged account in its branches from 1 January 2013, until its sales procedures are brought into line with those operated by sister bank The Halifax.
Lloyds TSB is one of the main providers of packaged accounts in Britain, with around one in three of its customers choosing to pay fees ranging from £9.95 to £25 a month for an account which includes extra services such as travel insurance and breakdown cover.
Its decision to postpone the sale of these accounts in branches will not affect customers who already have a packaged account
The bank denied that the decision was related to new Financial Services Authority (FSA) regulations on packaged accounts, which will be introduced in 2013.
The new rules, which follow recent scandals in which customers were mis-sold financial products, will require lenders to ensure that customers are eligible to claim on any insurance included in the package.
A spokesman for the bank said: “It is not about the Financial Services Authority or mis-selling, it is about moving to a unified process within the group.”
The FSA has called for an end to the practice of incentivising staff to sell products such as packaged accounts, as this is believed to have led to mis-selling.
Currently Lloyds TSB branch staff will recommend a packaged account to a customer, whereas Halifax branch staff will provide information but are not allowed to recommend a product.
Lloyds TSB customers will still be able to sign up for a packaged account online while the changes are brought into effect.
Earlier this month consumer group Which? published the results of a survey suggesting that Lloyds Banking Group, RBS and Barclays have continued to pressure sales staff to sell more, despite the mis-selling scandals.
Peter Vicary-Smith, Which? chief executive, said: “Our survey reveals the stark realities of the sales culture that still exists at the heart of the banking industry.
“Senior bankers say the culture is changing but this shows it just isn’t filtering through to staff on the front line who remain under real pressure to put sales before service, even after incentives are taken away.”