Websites that enable consumers to compare products and services to help them choose suppliers will be examined to see exactly how they work.
The Competition and Markets Authority (CMA) said they will review digital comparison sites such as Moneysupermarket, Go Compare, uSwitch and Compare the Market, to find out how they earn their money and the impact this might have on the services they offer.
The CMA said previous reviews of comparison sites in private motor insurance, energy and banking have highlighted how these tools can play a powerful role in increasing competition and helping consumers to find better deals and switch.
The new study will see how digital comparison tools (DCTs) in broadband, home insurance, credit cards and flights work for consumers and review growing concerns over the information that is available on the sites, as well as how they help business and the economy.
The CMA is also interested in hearing about important issues in other sectors where DCTs operate.
The watchdog said they will consider how to maximise the potential benefits of DCTs for consumers and reduce any barriers to how they work. It will also look into whether arrangements between DCTs and the suppliers that sell through them might restrict competition.
Andrea Coscelli, CMA acting chief executive, said: “Digital comparison tools have played a big part in changing markets for the better, bringing new ways of doing things and forcing businesses to up their game.
“Consumers have benefited as choice and access to goods and services have grown.”
The CMA must announce within 6 months whether it intends to refer the market for a more in-depth investigation and must publish its report within 12 months, setting out its findings and the actions it proposes to take, if there are any.
Ms Coscelli added: “Since emerging a decade or so ago, such tools have helped to inject significant competition into a number of markets, including private motor insurance.
“They have made it easier for consumers to engage in many markets. However, they have been more successful in some sectors than others. We want to understand why this is the case and whether more can be done to ensure consumers and businesses can benefit from them more widely.”