UK Post Office launches current account

UK Post Office launches current account

The Post Office will launch a current account in the next few weeks, using its massive branch network to take on Britain's high street banks.

The new account, provided by the Bank of Ireland, will be made available through a small number of Post Office branches from the spring before a wider roll-out across an 11,500-strong network next year.

The Post Office already provides a range of financial services - including savings accounts, mortgages, insurance, and credit cards - to around three million customers.

However, by introducing a current account it will be tapping into its huge branch network and trusted brand to provide real competition to Britain's big four banks.

The move has been on the agenda since the 2008 financial crash, with politicians keen to break the stranglehold of the 'big four' - Lloyds, RBS, Barclays and HSBC - which hold 75% of the market, according to the Office of Fair Trading, leading to a lack of dynamism and customer choice.

Nick Kennett, director, financial services, Post Office, says: "We've carried out extensive research into the current account market and the findings tell us that customers want simplicity, transparency and good value for money. With over 11,500 branches, which is more than all the UK banks combined, we can provide this through the most convenient and accessible retail network in the UK."

Several other new entrants are also bidding to take on the established players, including Metro Bank and Virgin, as well as retail giants Tesco and Marks & Spencer.

Comments: (2)

Bob Lyddon
Bob Lyddon - Lyddon Consulting Services - Thames Ditton 11 April, 2013, 17:432 likes 2 likes

Great innovative idea, I think it was called the National Girobank and was the brainchild of Antony Wedgwood-Benn. Given all the talk about mobile payments at International Payments Summit in London this week, the next step should be a tie-up with a telephony operator, like maybe British Telecom, and the renaming of the resulting conglomerate as the General Post Office.

If we are considering the legacy of Thatcher-era privatisation at this opportune time and whether value was created or destroyed, this is a case study. National Girobank was privatised but could not be floated. It was sold off to Alliance & Leicester on the cheap. Alliance & Leicester did nothing with it and then went under itself. The splitting of the GPO destroyed enormous value. Now the Post Office starts again from square one. Ever decreasing circles?

A Finextra member
A Finextra member 12 April, 2013, 12:13Be the first to give this comment the thumbs up 0 likes

@Bob: Law of Diminishing Returns...