Post Office extends current account trial to 110 branches
More branches are being included in the Post Office current account network, but there's still no date for a nationwide launch.
The Post Office is extending its pilot current account scheme to 110 branches throughout the east midlands and east of England.
It started the trial of 29 branches in May 2013, offering three different current accounts.
There is no definite date for its official nationwide rollout, although previously it said this would happen in 2014.
Post Office accounts
The Post Office current accounts have been set up with the Bank of Ireland UK.
There are currently 11,500 branches in the Post Office network, so when the current accounts launch nationwide they’ll provide strong competition to the high street banks.
No reason has been given as to why the Post Office isn’t launching the accounts nationwide yet. John Willcock, Head of Current Accounts at the Post Office, said: “This exciting move is in line with our planned next steps into making our accounts accessible to thousands of customers who are looking for a credible alternative to their existing bank.”
Customers will be able to choose from three different current accounts. The standard account is pretty basic and offers a debit card and free banking, if you stay in credit. You’ll need to deposit £100 to open one and an overdraft with an interest rate of 14.9% can be requested.
The packaged account offers a range of benefits in exchange for an £8 monthly fee. These include European multi-trip family travel insurance and breakdown cover, identity theft protection and a discounted travel booking service with a 7.5% discount on holiday bookings.
The third account in the range is the control account. This is aimed at customers who are new to banking or those who have a less-than-perfect credit history. It costs £5 a month and can be opened with £20. No further charges will be attached to unpaid payments, such as those set up by direct debit or standing order. The idea behind this one is it helps people get back on track with their finances.
Right now you’ll only be able to benefit from the new account if you live in the trial areas. If you need an account sooner, there are other options available.
Compare current accounts with lovemoney.com
Alternative accounts
The Post Office may be making a play for a bigger slice of the current account market, but there are plenty of other competitive current accounts available today, no matter where you live.
If you're looking foran account that rewards you for staying in credit then the Santander 123 account or Nationwide FlexDirect are both worth a look. Both accounts pay higher rates of interest than even the top savings accounts - the Nationwide account pays 5% for the first 12 months on balances up to £2,500, while Santander pays up to 3% on balances of up to £20,000. In fact the Santander account even gives you the chance to earn cashback on some of your direct debits.
Santander and Nationwide accounts are also your best bet if you're after a decent overdraft, though First Direct and the Co-op also offer accounts which won't charge a fee if you dip into the red.
And if you just want an account that will pay you a welcoming bonus then First Direct has increased its bonus to £125 to new applicants for its 1st Account, while Halifax will pay you £100 to switch.
For more, check out Best current accounts for 2014.
Compare current accounts with lovemoney.com
Competition on the high street
A number of alternative providers have arrived on the current account market over the last few years. Metro Bank was one of the first in 2010 launching a network of branches in London and marking itself as different from the big banks by opening seven days a week and until 8pm in the week. It is now opening a branch in Milton Keynes.
Marks and Spencer launched a paid-for account in 2013 designed specifically for M&S customers, costing £10 a month but delivering a range of extras.
Tesco and Virgin Money have both said they will launch current accounts in the near future, although exact dates have not yet been confirmed.
It can only be good news to customers if more providers are coming into this market as it improves competition and puts some much-needed pressure on the big names to provide a better service.
Will you be banking with the Post Office? Have you turned your bank on high street banks? Let us know your thoughts in the comments box below.
Compare current accounts with lovemoney.com
More on current accounts:
Get cashback with your current account
Barclays to 'simplify' overdraft fees
Metro Bank and Norwich & Peterborough to introduce overseas card fees
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