ONLINE accounts and instant payments could exacerbate future bank runs, the industry warned today, urging regulators to look into the possibility.
Technological advances have improved life for customers and boosted competition in banking, but the British Bankers’ Association (BBA) said it could also create risks.
“We all remember the queues outside Northern Rock as people sought to withdraw their money. That was before the arrival of faster payments and digital apps,” said the report from the BBA and Accenture.
“Now it is possible to move significant sums at the touch of a button.”
The BBA also wants regulators to apply the same consumer protection and financial stability rules to non-bank firms providing financial services as they do to banks. That means global giants like Google, Apple, Amazon and PayPal, which all provide payments or finance services from other sectors.
“Regulators have to get the balance right so they do not deter innovation,” said BBA boss Anthony Browne. “But if competition is only based on customers getting a raw deal, then that is not a good thing.”