Royal Bank of Scotland (RBS) and NatWest customers will be able to access current and business accounts at Britain’s 12,000 post offices after the government ditched plans for a state-backed Post Office bank.
The agreement means post offices will provide services for 80 per cent of current accounts in Britain, postal affairs minister Edward Davey said.
“Setting up and capitalising a bank would be time-consuming and extremely expensive,” Davey said in a statement. “At a time when public finances are under huge strain ... funding is better spent modernising and maintaining the network.”
An RBS spokesman said no start date had been set because the two sides were still finalising details of the agreement, but they were aiming to launch it as quickly as possible.
HSBC and Santander will be the only banks in Britain that do not enable all their current account holders to use post offices, and the government is encouraging them to join their peers, a Department for Business spokesman said.
The government is also eager for the Post Office to branch into other financial services, the department said. It said the Post Office would offer new products through its relationship with Bank of Ireland and look into ways it and credit unions could work more closely together.
The government also wants branches to become its “front office” and a pilot project had been agreed for the Post Office to print government forms on demand, the department said.
Last month the government said it would provide £1.3bn of extra funding to the Post Office.
City A.M. Reporter