Tweet
The Government today announced a major expansion of the financial services offered by the Post Office in a move to make the 11,500-strong branch network "more sustainable".
Lord Mandelson, the Business Secretary, said: "The Post Office is a well-loved community institution and this move will bring more banking services back to the heart of those communities".
However, Which?, the consumer group, cautioned that The Post Office's savings products are offered in partnership with the Bank of Ireland, and are therefore not covered by the British Government's savings guarantee.
Dominic Lindley, of Which?, said: "We welcome much of the expansion, but cannot recommend Post Office products as Best Buys while customers must risk their money on a foreign government's compensation scheme."
The measures, backed by £180 million of new funding, will include the launches of new savings and current accounts aimed at people on low incomes, as well as a 90 per cent loan-to-value mortgage for first-time buyers.
The most innovative of the new accounts will be a Savings Gateway account for people of working age on low incomes. The Government will pay in 50p for every £1 saved – "to kick-start the savings habit".
Ed Miliband, the Energy Secretary, said: "Paying bills by direct debit often means a discount on bills of nearly £100 a year. This new account will mean some of the consumers who have to pay higher bills will be able to benefit from that discount."
The Post Office is also in "detailed negotiations" with RBS and Santander to give access to their current accounts. It says that this would mean that 86 per cent of UK current accounts would be accessible in branches.
Further plans include a partnership with credit unions to create a "national distribution network" for their loans and other products in Post Office branches to increase access to affordable credit.
The Irish deposit guarantee scheme, which applies to Post Office savings products, covers all deposits in qualifying accounts up to September, and the first €100,000 (£90,000) thereafter.
The British scheme, which does not back Post Office products, covers the first £50,000.
http://www.timesonline.co.uk/tol/mon...cle7080158.ece
Lord Mandelson, the Business Secretary, said: "The Post Office is a well-loved community institution and this move will bring more banking services back to the heart of those communities".
However, Which?, the consumer group, cautioned that The Post Office's savings products are offered in partnership with the Bank of Ireland, and are therefore not covered by the British Government's savings guarantee.
Dominic Lindley, of Which?, said: "We welcome much of the expansion, but cannot recommend Post Office products as Best Buys while customers must risk their money on a foreign government's compensation scheme."
The measures, backed by £180 million of new funding, will include the launches of new savings and current accounts aimed at people on low incomes, as well as a 90 per cent loan-to-value mortgage for first-time buyers.
The most innovative of the new accounts will be a Savings Gateway account for people of working age on low incomes. The Government will pay in 50p for every £1 saved – "to kick-start the savings habit".
Ed Miliband, the Energy Secretary, said: "Paying bills by direct debit often means a discount on bills of nearly £100 a year. This new account will mean some of the consumers who have to pay higher bills will be able to benefit from that discount."
The Post Office is also in "detailed negotiations" with RBS and Santander to give access to their current accounts. It says that this would mean that 86 per cent of UK current accounts would be accessible in branches.
Further plans include a partnership with credit unions to create a "national distribution network" for their loans and other products in Post Office branches to increase access to affordable credit.
The Irish deposit guarantee scheme, which applies to Post Office savings products, covers all deposits in qualifying accounts up to September, and the first €100,000 (£90,000) thereafter.
The British scheme, which does not back Post Office products, covers the first £50,000.
http://www.timesonline.co.uk/tol/mon...cle7080158.ece
Comment