THOUSANDS of people who use the Post Office to claim benefits and the state pension are being moved to a new payment method this week.
Post Office card accounts [POca] are used by those who don’t have a bank account to access their benefits.
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However, from November 30 POca are being closed after the Department for Work and Pensions [DWP] decided not to renew its contract.
Instead, the DWP will begin the process of moving people over from POca to its new Payment Exception service from today.
This will allow you to access benefit payments, such as Universal Credit and the State Pension through the PayPoint network.
You will be automatically moved to this service if you yse a POca to collect benefits, unless you provide the DWP with new bank account details.
An estimated 780,000 people use a Post Office card account, which can be used to withdraw funds with no fees or charges.
The Sun has contaced the DWP for comment on how many people are affected by the change and what the cost of the new system is.
This story will be updated when we have more information.
What happens when the Post Office accounts close?
You have two options, you can either have the payments made to a bank account or you can use the Payment Exceptions service.
If you want your benefits payments to be made to a bank account then you will need to tell the DWP your bank account details.
You can do this over the phone by calling 0800 085 7133 or by post if you get a letter from the DWP or HMRC.
You also need to tell the Post Office to close your card account – make sure you withdraw any money first.
You can do this by completing an account closure form at your local Post Office, or calling 0345 722 33 44.
If you are unable to use a bank account then you can use the Payment Exceptions service.
To access this service you will need to speak to your local benefits office, or respond to the letter about the Post Office card account closures that you received from the DWP.
How do I open a bank account?
The government’s MoneyHelper service says you have three options for a new account:
- current account
- basic bank account
- prepaid card
A basic bank account is designed for people who don’t qualify for a bank’s current standard account – for example, they’ve got poor credit history and have experience of serious money problems.
Pre-paid cards can also be used if you can’t get a current account, but Martin Lewis has warned that they often come with expensive and unnecessary charges.
All three types of account can be used to deal with day-to-day spending and paying bills, as well as getting your benefit payments.
It’s worth comparing the different types of bank account to work out the best option for you.
You can check out MoneyHelper’s guide to choosing the best bank account for benefit payments.
Here we explain all you need to know about finding a basic bank account and how to get accepted.
If you need help opening an account or are affected by the Post Office card account closures you can find free and friendly help from the following services:
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