UK Post Office set to offer personal loans
The Post Office is set to offer unsecured personal loans as part of its push into financial services.
The Post Office, which has a joint venture with Bank of Ireland, plans to offer the products through its 16,500 branches.
The Post Office’s move into financial services is being spearheaded by its chief executive David Mills and follows its move into travel services like foreign currency exchange.
Mr Mills has been keen to use the network to sell financial services.
The plan forms part of the Post Office’s attempts to revitalise a branch network hit badly by the decision of the UK’s Department of Work and Pensions to start paying state benefits directly into bank accounts.
The Post Office estimates that 29m people use its services every week, while 95 per cent of the population live within 3 miles of a post office. The Post Office’s move into personal loans comes at a time when statistics compiled by Datamonitor, show that high street banks are losing their share of the personal loans market and now account for 40 per cent of all new loans taken out compared with 60 per cent of loans in the past.
The Post Office range is eventually expected to include insurance and savings accounts.
Patrick Waldron, chief executive of the joint venture and former director of retail strategy at Bank of Ireland, said the Post Office was encouraged by early pilots of the product.
Bank of Ireland is to invest Pounds 125m into the venture over the next 10 years to provide key infrastructure and start-up costs. The joint venture is owned by the BoI and Post Office and profits are split evenly between the two.
