Consignia Changes Banking Relationship with A&L
Consignia is to terminate an exclusive deal with Alliance & Leicester to handle the cash paid by businesses over post office counters, in a move which could signal a change in the special relationship between the two organisations. A&L owns the Girobank network, which operates through post office counters. Questions have been raised about A&L’s relationship with the Post Office ever since the government announced plans for universal bank services in post offices, in an attempt to provide bank accounts for benefit claimants. A&L bought Girobank in 1990 and partly because of its relationship with the PO, handles one in four of the notes and coins circulated in Britain. Girobank is part of the com mercial business which accounts for at least 15% of A&L’s annual profits. According to an internal post office memo, A&L has been given 12 months’ notice of the termination of a contract to handle cash paid in by businesses at more than 18,500 post office counters. If this contract with A&L can be renegotiated the big four banks – which have a more than 70% share of business banking market – may be able to offer their business customers the same types of services their personal customers are currently able to perform in post offices. ” The article states: “The Post Office has made it clear that it sees revenues generated from banking as a crucial way of replacing some of the pounds 400m in income it will lose when social security payments are paid directly into bank accounts rather than handed out in cheques and cash
Jill Treanor, the Guardian (UK):
