The Building Societies Association and the Association of Financial Mutuals have launched a manifesto calling for policy changes to help mutuals.
Launched in the run-up to next year’s general election, the 14-page manifesto calls for a level playing field for financial mutuals and a co-ordinated approach to promoting them.
The manifesto requests changes, such as creating a statutory duty for regulators to foster diversity, allowing building societies to invest in mini-bonds and a dedicated Cabinet office function to champion mutuals.
Robin Fieth, chief executive of the BSA, said: “There is a widespread consensus that a diverse financial sector benefits consumers and the economy alike.
“Therefore, it is a bitter irony that in the effort to address poor behaviour by some plcs and prevent another financial crisis, the resulting legislative and regulatory framework threatens to undermine rather than support corporate diversity.”
Martin Shaw, chief executive of the AFM, said: “It should be a national scandal that not a single new mutual has been set up since the last decade of the last century.
“Politicians need to translate their aspirations for greater diversity into concrete actions to help the financial mutuals sector to compete on level terms, and to deliver a fairer marketplace for consumers.”
Anthony Eden, of Essex-based Eden Independent Financial Advisers, said: “I think there needs to be more product innovation.
“Approximately 10 years ago there was quite a big dividing line between the banks and building societies, but if you look at some of the largest ones, they may be building societies, but they effectively act like a bank.”