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* Watchdog sticks with proposals outlined in May
* Focus on a fintech "revolution" in banking
* Consumer group disappointed with overdraft action (Adds more detail, consumer reaction)
By Huw Jones and Andrew MacAskill
LONDON, Aug 9 (Reuters) - British banks will from 2018 haveto share customers' data with third parties who can then showhow much could be saved by using other lenders, the competitionwatchdog said on Tuesday.
Customers currently are paying more than they should forbanking and are not benefiting from new services, theCompetition and Markets Authority (CMA) said in its final reportafter a three-year review of consumer and small businessbanking.
Third-party companies have already begun to build "apps" formanaging finances on a phone or other devices, and the CMAbelieves that setting a 2018 deadline will also boost the"fintech" sector.
The government wants to see fintech grow, a sector EuropeanUnion countries like Germany want to lure from London afterBritain voted to leave the bloc.
"This is a real opportunity for the UK to take the lead. Weare going to make it happen and give it a push to get it acrossthe line," Adam Land, a senior director at the CMA, said. "Thereis no question that fintech companies are champing at the bit."
High street banking in Britain is dominated by the "bigfour" lenders - Lloyds Banking Group, Royal Bank ofScotland, Barclays and HSBC - whocontrol more than three-quarters of current accounts and providenine out of 10 business loans.
The CMA hopes its proposed measures, which differ littlefrom draft measures outlined in May, will make it easier forpersonal and small business customers to switch lenders. At themoment only 3 percent of consumers and 4 percent of businesscustomers change banks in any year.
Under the new rules, banks will have to share a customer'sdata with third parties, providing the customer agrees.
The CMA will also require lenders to publish a maximum feefor unarranged overdrafts which earn banks 1.2 billion pounds($1.6 bln) a year.
Consumer group Which?, however, said that measure did not gofar enough as banks would still set the maximum rate and sowould be able to continue to charge "exorbitant fees".
Land said the Financial Conduct Authority, which cappedpayday loans' interest rates, will review the overdraft measuresto see if they work.
Allowing banks to set their own cap gives them flexibilityto compete with each other on offering the lowest overdraft fee,he said.
($1 = 0.7701 pounds) (Reporting by Huw Jones and Andrew MacAskill; Editing by JasonNeely and Susan Fenton)
