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The way price comparison websites work is to be examined by the Competition and Markets Authority (CMA). Among other issues, it will look at how far sites such as Moneysupermarket, Uswitch and Gocompare can be trusted by the customers who use them.

The CMA says it will look at whether consumers should be made more aware of how such sites earn their commission. The study will look at all price comparison sites, including broadband, energy, insurance and banking.

Consumers are not always made aware of the cheapest deals on price websites, and usually they cannot switch to such deals immediately. Companies often pay a fee of about £30 to a site for each new customer they gain.

Andrea Coscelli, CMA acting chief executive, said: “Digital comparison tools have played a big part in changing markets for the better, bringing new ways of doing things and forcing businesses to up their game.

“Consumers have benefited as choice and access to goods and services have grown.”

He said they had been more successful in some sectors than others.

The CMA said it wanted to understand why this was the case and whether more could be done to ensure consumers and businesses can benefit from them more widely.

It will examine four areas:

  • What consumers expect from comparison tools, how they use them and their experiences
  • The impact of such tools on competition between suppliers listed on them
  • How effectively comparison tools compete with each other
  • The effectiveness of existing regulation

The CMA must announce within six months whether it intends to refer the market for a more in-depth investigation and must publish its report within 12 months.

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