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Italy’s competition watchdog has ordered Intesa Sanpaolo, the country’s largest lender, to stop migrating customers to its new online service Isybank after receiving more than 5,000 complaints this month from account holders that were shifted without their consent.
The Rome-based regulator said on Thursday that it wanted customers to “be put in the condition of choosing whether to keep an account in Intesa Sanpaolo at previous conditions or shift to Isybank”.
Isybank, which was launched in June, is Intesa’s latest rollout of a cloud-based service, a key pillar of the lender’s strategy to fend off competition from online services and fintech groups, and Intesa hopes to transfer millions of customers across.
An enhance in digital investments is part of a broader strategize to lower retail banking costs and focus on more profitable activities such as insurance and wealth management.
As part of the transfer of accounts to Isybank, customers will lose access to Intesa’s 3,000 branches across the country and will have to supervise their money entirely via an app.
Thousands of customers this month complained to the regulator that Intesa had not asked for their permission before automatically transferring them to the new service. The regulator opened a probe on November 2 looking into the way customers were being shifted across.
Customers received a text message or email from Intesa informing them their account had been transferred to its new online service. The regulator said such means of communication were insufficient given the importance of the matter.
Intesa said in response to the probe that it had complied with regulations and customers who were transferred had until the end of February this year to ascertain if they wanted to advance back.
Many account holders complained the message had been sent to them over the summer holiday and they had read it only after the deadline by which they could have refused the transfer.
The national consumer association, Unione Nazionale Consumatori, said the “forced” transfer was unfair especially to older non-tech savvy clients.
Earlier this month Italy’s rightwing coalition criticised Intesa for what it called a “forced migration” and demanded it give customers more time to make an informed decision.
According to the regulator more than 300,000 customers have been shifted to the online-only service since October. However, the consumer association said the lender had written to clients who have not yet been migrated, to extend the deadline by which they must give their consent.
Shares in the lender we down slightly in early trading on Thursday.
Intesa did not immediately reply to comment requests.
