The Post Office’s (PO) banking remuneration is “completely unsustainable” and leaves stores unable to cope with increased demand due to high-street bank branch closures, according to experts.
Retailers, the National Federation of SubPostmasters (NFSP) and politicians all criticised the PO, as Santander announced an additional 140 bank branch closures.
One store owner explained: “Post offices have rightly filled the gap [left by bank branch closures]. However, the commission rates are so low that it is not financially viable. Taking in one of the new fake £20 notes wipes out the earnings on £60,000 of deposits. Post Office has also not provided any note-checking equipment.”
For handling a £1,000 cash deposit in one of its branches, Santander charges customers £7, but PO retailers said they receive between 24p and 35p from the PO for the same transaction.
An NFSP spokesperson told RN: “Research shows subpostmasters are paid the equivalent of less than £2 per hour for business banking deposits – which is completely unsustainable.”
Labour MP Lesley Laird agreed: “While banks cite that customers can bank at POs, subpostmasters across the UK are reporting they are struggling financially to provide these services,” she said.
PO responded: “Through our recent modernisation programme, we have invested in enabling postmasters to operate their businesses more efficiently.
“We’re committed to continue this and are investing in further efficiencies for retailers and actively supporting them to ensure their businesses are as efficient and profitable as possible.
“For banking, we have changed some of the terms of deposits presentation to reduce transaction time – such as complete coin bags – and have offered subsidised cash counting machines in partnership with the NFSP to speed up counting and help root out forgeries.”
At £195 plus VAT, retailers on 25p per £1,000 would have to handle nearly £1m in deposits before covering the cost of the subsidised cash counting machines.
PO banking director Martin Kearsley said its banking was “not profitable”. “We are in discussions with banks to change that,” he added.
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