Veronika Thiel is a researcher and project manager on nef’s Access to Finance team.
Can the leopard change its spots after all? It appears so! It was a ‘leaked’ letter by Lord Mandelson to the Guardian that indicated a change in Government thinking. Instead of finding new ways to justify post office closures, the Government abandoned a tender for the running of the POCA and left it where it was – with the Post Office.
nef welcomes this move, but we also, as always, go a step further: we want to see the creation of a People’s Bank at the Post Office. Now, it seems, there are some MPs who start to come round to our thinking. As the Financial Times report, the Post Office could indeed soon be offering current accounts.
Since we seem to have the Government’s ear at the moment, can we ask you to consider the following when you recreate the People’s Bank?
- make sure it is accessible for all, and a champion for innovation as the Girobank once was.
- make it a bank for people on lower incomes and the financially excluded by being transparent and flexible
- make sure it invests its deposits where they are collected – in the local communities
- and use the opportunity to make the high-street banks follow suite.
Britain already has one of the highest banking concentrations, with only four high street banks covering most of the market. This reduces customer choice and stiffles innovation. By introducing a new bank, people would finally have what has recently become a scarce commodity: choice of where to bank.
I would not be surprised to find that many would choose the People’s Bank.
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20 November, 2008 at 12:40 am
Jason Kemp
In New Zealand Kiwibank was setup by the Labour government for very similar reasons. Despite all sorts of reasosn why that was a “bad” idea it has succeeded.
http://www.kiwibank.co.nz/about-us/ leverages the Post Office network of branches and systems and since rolling out in 2002 and now got 600,000 customers in a country of 4m people.
Elsewhere we have 4 big Australian owned banks controlling the bulk of the business but Kiwbank has tipped the balance and despite being owned by the government it has been a huge success.