Gateway to help more people save

Money

Anyone claiming benefits or on a low income in the Borough can cash in on 50p for every £1 they put away, as part of the Government drive to encourage people to save.

It is hoped it will encourage around eight million people on low incomes across the UK to save more by offering them incentives through Saving Gateway Accounts, up to a maximum contribution of £300.

People claiming Income Support, Jobseeker’s Allowance, Incapacity benefit, Employment and Support Allowance or Severe Disablement Allowance will be able to take part, according to the Treasury.

In addition, people claiming Working Tax Credits or Child Tax Credits earning less than £16,040 also qualify.

The announcement was made by Business Secretary Lord Mandelson, who also confirmed post offices will be turned into mini-banks in a bid to help secure the future of the network.

Customers will be able to open current accounts over the counter at their local branch and access them from any branch in the UK under the major revamp of financial services the organisation offers.

Mortgages of up to 90 per cent, aimed at first-time buyers, will also be introduced as well as savings, budgeting and children’s accounts.

Lord Mandelson claims it will put banking back into the heart of communities and make the Post Office network of 11,500 branches more sustainable.

The Business Secretary, who also announced £180 million of new funding for the network, said: “Since the global banking crisis we have set about reinventing the financial services industry piece-by-piece, building a system that is fairer, trusted and more responsible.

“Today is the next step in that process. The Post Office is a well-loved community institution and this move will bring more banking services back to the heart of those communities.”

The Government is in negotiations with RBS and Santander over giving access to their current accounts at branches, which would mean around 86 per cent of current accounts would be accessible at post offices.

Business account holders at Santander will be able to access their accounts at local branches and the network is also trying to develop its own business banking products.

Shadow business secretary Ken Clarke said the announcement was too little too late.