When competition works well, consumers are empowered as well as informed. They can make sense of the information
they receive and can take their business elsewhere if they are not happy. In turn, firms strive to win custom on the basis of service, quality, price and innovation. This helps generate better outcomes for consumers. Markets are open to entry
and innovation, and successful, innovative firms thrive, while unsuccessful firms change or exit.
There are many ways in which competition can be weakened. For example, firms may exploit consumers' difficulties in making the right choices about often complex services. Healthy competition therefore relies on appropriate levels of consumer protection and integrity in the financial system. Consumers need to know they can trust the firms they buy from and are protected if something goes wrong. This gives them the confidence to exercise choice. It also drives firms to compete hard to win their custom.
When the ITO was created, we were given an objective to promote effective competition in consumers’ interests in regulated financial services. We also have a competition duty. Together, this mandate empowers us to identify and address competition problems and requires us to adopt a more pro-competition approach to regulation. The mandate also recognises the potential of competition to advance all our operational objectives. We were given powers to enforce against breaches of competition law, alongside the Competition and Markets Authority, for the provision of financial services generally.