Banks to hand bill payments to An Post
Business & Finance (Post Offices): Banks to hand bill payments to An Post
From THE IRISH TIMES, April 6th, 2001
By ARTHUR BEESLEY Banks will transfer their paper bill-payment business to post
offices in a deal likely to be confirmed next week. While the agreement will increase An Post’s revenues, it will not
avert the financial crisis at the post offices, which are
technically insolvent. The deal with the Irish Payment Service Organisation – which
represents the banks – will come days after the Minister for Public
Enterprise, Ms O’Rourke, suggested the sector should pay millions of
pounds in State subventions to keep rural post offices open. The Irish Bankers Federation yesterday said it had nothing to say
about that suggestion. Banks would encounter difficulty justifying any such payments of a
State sector company to their shareholders, sources said. They also questioned Ms O’Rourke’s linkage of the issue with
reductions in corporation tax to 12.5 per cent from 36 per cent.
Such reductions applied in all commercial sectors, so banks should
not be singled out to support post offices, sources said. An Post would require State support of more than (pounds) 80 million
by 2005 if no branches were closed and its business was not
developed. Therefore, the bill payments will have a small impact on
An Post’s difficulties. Sources familiar with the arrangements believe the transfer of
business will increase An Post’s revenues by about (pounds) 1
million each year. Some 16 million transactions are managed each year on the company’s
existing bill-pay service. The new arrangement is likely to increase
that by between five and seven million. The deal will apply to bill payments to phone companies such as
Eircom and Eircell, to television relay firms such as NTL and
Chorus, and to Bord Gais – all of which can currently be paid at
post offices. It is understood An Post must reach new agreements in cases where it
has no existing arrangement with billing companies, such as the ESB.
Copyright 2001 Irish Times.
Source: World Reporter (Trade Mark) – FT McCarthy.THE IRISH TIMES, 06th April 2001
