Parents should be allowed to buy baby milk formula using loyalty points and vouchers, the regulator has said after a probe into the market.
Restrictions on price promotions and discounts on formula should remain in place so mothers are not discouraged from breastfeeding, the Competition and Markets Authority (CMA) said.
But people should be allowed to use points, gift cards and vouchers to get the most for their money, its chief executive told the BBC.
The regulator also said formula should have standardised packaging in hospitals as part of a number of recommendations designed to make the market work better.
At present parents are facing “poor outcomes” because of the way the baby milk market works, the CMA said.
Baby milk brands often provide hospitals with formula below cost, because once parents start using a brand, they tend to stick with it.
Parents also feel guilty about using lower-priced brands, because they think they are somehow inferior – but they have the same nutritional value as the more expensive options, the CMA said.
But the regulator said households could be saving £300 per year by switching.
