The UK Post Office is looking to shake up big banking dominance, announcing the introduction of current account financial services in the coming weeks.
The new account type, provided by the Bank of Ireland, will begin rolling out in a few Post Office branches. The small introduction will then be followed by an expansion to more than 11,500 branches across the country, as Finextra reports.
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The UK finance market has been strongly dominated by four major contenders. As the Office of Fair Trade reports, Lloyds, Barclays, HSBC and RBS currently account for 75 percent of the market share, making it difficult for new competitors to develop. Lack of competitors means lack of consumer choice, which is an issue that has been on British politicians’ radars since the 2008 financial crash. Introducing a current account service at the Post Office is their attempt to interrupt the market dominance, allowing for diversity in the banking sector and greater consumer choice.
Nick Kennett, director of financial services at the Post Office, stated, “We have carried out extensive research into the current account market and the findings tell us that customers want simplicity, transparency and good value for their money,” reports BBC News.
The Post Office does offer some financial services to customers, including the ability to withdraw and deposit money from other financial accounts. However, several banks, such as Santander, do not allow these types of transactions to be conducted at the Post Office.
Other brands including Marks and Spencer and Tesco have announced plans to launch current account services in the near future as well. The Post Office is a recognized brand with a large network, which may attract a large number of UK consumers to register.
Kevin Mountford, head of banking at comparison website Moneysupermarket, said, “The Post Office current account should have mass market appeal due to its large customer base and ease of access, so I expect this account will be very popular.”
Read the full story at BBC News here, and at Finextra here.
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