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Price comparison websites may be subject to increased scrutiny

July 9th, 2009 by admin | 0 Comments | Filed in Daily News, Mortgages

money info The list of ways that the internet makes our lives easier and better may be so long that it could stretch from London to Glasgow, but if the list was examined in a bit more depth, a few of the items might not stand the scrutiny.

One of the items with a question mark around it may well be these comparison websites that appear online, allowing potential purchasers to compare prices of the same product on several competing online stores. Tougher rules regarding this ostensibly innocent practice is expected to be introduces with a view to preventing advertising prices and comparisons which are fictional and often in the extreme.

Particularly sensitive are comparison sites providing quotes for loans and credit cards. Under a new voluntary code of conduct to be introduced, these sites will be obliged to provide up-to-date pricing information and not rough estimates as has been the case till now. The code of conduct, to be unveiled this week, will have the power to disallow web sites from participating in comparison schemes, if they provide a quote that can be regarded as misleading the consumer through being based on information that the adjudicators could construes as being misleading to the consumer

Another role that the comparison website adjudicators will be taking care of is the prevention of conflicts of interest. Most of these comparison web sites earn their income from recommendation fees, a practice that could tempt unscrupulous site operators to steer a client in the direction of a service supplier where they will be earning a larger fee rather than one whose prices or service is better.

Companies who agree to participate in the code of conduct must undertake to agree to set code of practice as far as handling consumer personal details before they are passed on.

Comparison websites are a serious business in the UK, with estimates that more than ten million people in the market for personal loans, mortgages, car and home insurance visiting them in order to get what they assumed was an objective picture of pricing.