PO refuses to pledge no-frills bank accounts for poorest

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Post Office refuses to pledge no-frills bank accounts for poorest

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The Post Office is refusing to reveal whether it will offer branch customers a basic bank account as it prepares to launch into the banking market.

Such accounts are taken up by people who otherwise would not get access to a current account because of their failure to pass credit score tests imposed by the banks.

The Post Office, with its 11,500 branches, is ideally placed to provide such a banking service and its entry would greatly reduce the number of financially excluded adults.

But last week it declined to say whether its new current account range, managed by controversial partner Bank of Ireland, would include a basic banking package.

‘We can provide no details at the moment,’ said a spokesman.

If the Post Office does not offer basic bank accounts, it is likely to be criticised by MPs across the political spectrum.

More than eight million adults have taken out basic bank accounts that typically provide no (or a minimal) overdraft facility, but offer a debit card to make payments and access cash machines.


The accounts also ensure users are able to enjoy special deals on energy, for example, that depend on payments being made by direct debit.

The Post Office’s reluctance to confirm whether it will offer such an account comes as key consumer groups try to persuade the banking industry to agree to a three-point plan that would bolster the number of basic accounts and reduce financial exclusion.

Christine Farnish, chairwoman of Consumer Focus, wants banks to ensure that anyone opening a basic account can make withdrawals at all cash machines nationwide.

At present, Lloyds Banking Group and Royal Bank of Scotland restrict their basic bank account customers to using their own cash machines.

She also wants all banks to offer such accounts as a default option if someone is unsuccessful applying for a regular account.

Some organisations, such as Nationwide, do not mention the basic bank account as an alternative, arguing that customers might find a conventional current account from a rival.

Farnish also wants basic bank accounts to be actively marketed in branches, despite the fact that they make banks no money.

She told The Mail on Sunday last week: ‘Basic bank accounts will become more important as a result of welfare changes and the need for adults to have access to banking services.

‘It’s vital all banks are committed to responsible banking and serving all sections of society, disadvantaged and advantaged.’