A consumer watchdog investigation into why Jersey residents are paying more for their mortgages has called for "greater transparency" from the banking industry.
The report by the Jersey Consumer Council (JCC) found rates offered by lenders in Jersey were about 1% higher than rates offered by the same banks in the UK.
Banks in Jersey said the higher rates were due to their "operational structure", but the JCC said it had led to "confusion" for customers.
The government said it was encouraging Jersey lenders to offer competitive rates and would continue to monitor mortgage availability.
'Serious questions'
The investigation by the JCC said that consumers in Jersey "struggle to understand" why they have pay up to £20,000 more per £100,000 of loan over the lifetime of a mortgage when borrowing over 25 years, than UK customers of the same bank.
It said the discrepancy "raises serious questions about the price Islanders are paying for living in an international finance centre."
The report added many of these banks still align with their UK parents, in terms of branding, marketing material and products which track the Bank of England base rate.
'Greater transparency'
The JCC wrote to lenders in March, asking for an explanation to ensure a "fair and transparent mortgage market".
Banks in the island said the difference in rates was due to their status as ring-fenced and separate entities from their UK counterparts.
The JCC noted rates are further influenced by the higher savings rates offered in Jersey, which are designed to attract investment.
However, it said the investigation's findings "highlight the need for greater transparency from the banking industry to help consumers better understand the differences."
It added the government needs to reassess "the balance between attracting inward investment and ensuring affordable home ownership for Islanders."
'Less choice'
Assistant Minister for Financial Services, Deputy Elaine Millar, said the government was aware of the the report and "may look to discuss its contents with the authors in due course."
“Jersey’s housing market has many different characteristics to that of the United Kingdom and there is significantly less choice of mortgage lenders due to the modest market size," said Ms Millar.
"We continue to encourage banks in Jersey to offer a range of competitive mortgage products to Islanders and will continue to monitor this availability closely.”