Working paper
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In a retail banking sector characterised by both high concentration and low consumer switching, questions arise for Australian policy makers and regulators as to the effectiveness of competition as one important means by which economic outcomes are engendered, including innovation beneficial to consumers and consumer welfare generally. Such questions include the appropriate response to ‘digital disruptions’ such as peer-to-peer lending, and the role for assessing competition proactively as part of ongoing policy formulation.
To contribute to debate on these issues, this working paper looks firstly at the role of competition generally, and then at the evidence for levels of competition in retail banking specifically, before highlighting some options for facilitating more competition and concluding that a policy response to these questions is well worthy of specific further study.

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