Post Office unveils current account details

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The Post Office has announced a much awaited foray into the current accounts market, but will it change things for us?

Customers complain about poor service, hidden charges and hard sell tactics

Recently the Post Office announced details of its much awaited foray into the UK current account market, but is it really going to shake up the UK retail banking sector as some experts are predicting?

The initial rollout of the three new current account options will be run as a pilot in 29 branches across East Anglia before being rolled out to the rest of the country in 2014.

In its favour the Post Office is a trusted household name with an established network of more than 11,500 branches across the country.

But will this be enough to tempt people to switch their bank account, an area where lethargy is rife?

Even though customers complain about poor service, hidden charges and hard sell tactics, those who actually do anything about it and move their account remain in the minority.

With regards the accounts on offer from the Post Office consumers will be able to choose from a Standard account, a Packaged account or a Control account.

The Standard account is a no frills bank account which comes with a debit card and can be opened with an initial deposit of £100.

There’s no interest paid on credit balances however the authorised overdraft interest rate of 14.9% EAR is amongst the most competitive on the market. It’s good to see that Post Office hasn’t gone down the route of daily fee charging for overdrafts and although there will be no charges for unauthorised overdrafts you will still be stung with a £15 fine for any unpaid items.

The Packaged bank account charges £8 per month and includes European multi trip travel insurance and Vehicle Breakdown Cover – the full details of these policies have not yet been released so it’ll be interesting to see how comprehensive these add-on products are and how they stack up against competitor products.

Again the interest rate for overdrafts is a very impressive 14.9% EAR but unless you make full use of the inclusive benefits then you’d be better off saving the £96 annual cost and opting for the Standard account.

The last of the trio is the Control account which is aimed at those who don’t want to incur expensive unauthorised banking fees and unpaid charges.

This account costs £5 per month and whilst it gives people access to online banking, telephone banking and a nationwide network of ATMs, there is no debit card available.


Whilst avoiding expensive banking charges may help some people, others are likely to balk at paying £60 per year for what is a basic bank account.

There’s nothing particularly new or exciting with these products, but then many people are just looking for something that does the job, no bells and whistles, just a no-nonsense account without hidden or excessive fees, all backed up with consistently good customer service and a system that doesn’t keep falling over due to IT issues.

From September this year the new seven day switching rules come into play. I’m yet to be convinced that it’s the time it takes people to switch that’s holding people back and that it’s more down to the perceived hassle and fear that payments may go astray during the transfer process.

If I’m wrong and disenchanted high street bank customers start switching to Post office in their droves, let’s hope there is sufficient staff resource available to handle the extra footfall in their branches to keep the queuing to a minimum.

With so many people disillusioned with the poor service levels and below average products from their current bank, there’s a huge pot of new business just waiting to be convinced that Post Office is a better banking alternative.

There’s no reason why the Post Office shouldn’t become a major competitor in the current account market, but much will depend on its ability to build a reputation for consistent and reliable customer service across its huge network branches.