The Business Secretary Lord Mandelson today opened a public consultation on new financial products and services that could be offered by the Post Office.
Lord Mandelson said:
“The Post Office is a great British institution that has been part of our economic and social fabric for well over three hundred years.
“Growing financial services at the Post Office will help secure the future of the network and give people access to a full range of banking products at an institution they trust and value.
“At a time when some banks and financial services companies are seeking to reduce face to face contact with customers, the Post Office stands out. It offers a trusted brand, and has more branches than the high street banks combined. It is ideally placed to bring banking services back to the heart of people’s communities.”
The consultation outlines a number of financial services that the Post Office could offer, including:
- Post Office Current Account – its own current account accessible from any of the over 11,500 branches across the country.
- Post Office Children’s Savings Account – an account designed to encourage children to save through visits to their local Post Office.
- Post Office Business Bank Accounts – currently the Post Office offers access to business accounts from a few High Street banks. It could offer increased access to business accounts from other providers, as well as its own business account.
- A weekly budgeting account – many low income households are unable to take advantage of the savings that can be made by paying for services by direct debit. One way to tackle this problem is by offering a simple account that could ring-fence a proportion of income each week, and then pay out bills by direct debit on a monthly or quarterly basis.
- A closer link between the Post Office and credit unions – it can be difficult to access credit union accounts when people are not in their local area. The local nature of the Post Office makes it ideally placed to allow credit union savers to access their accounts across the country.
- Working to ensure all banks’ current accounts can be accessed at a Post Office – currently 60% of current accounts (around 25m accounts) can be accessed at Post Office branches. The Government wants more banks to allow their current accounts to be accessible at the Post Office.
The Government is also keen for the Post Office to be a more significant player in the mortgage market.
Lord Mandelson said:
“I would like to see the Post Office at the forefront of the provision of good value mortgages across the UK. The Post Office has rapidly grown sales of its award-winning mortgages and is today announcing improved rates across its mortgages range.
“Our consultation outlines exciting proposals, but I want people to have their say. This is an opportunity for local communities to tell us what they want and need from their Post Office. Information about the consultation will be available in all of the network’s 11,500 branches.”
The Post Office is one of the UK’s fastest growing financial services providers, and the country’s number one foreign currency provider. This consultation is the next step towards turning the Post Office into a leading player in financial services, offering banking products across its network of over 11,500 branches.
The consultation reinforces the Government’s commitment to a secure and sustainable future for the Post Office, following the decision in November 2008 to award it a new contract for the Post Office Card Account, and the investment of up to £1.7bn to 2011.
Notes to editors
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