Post Office to launch new financial services

Royal Mail plans to offer 29 million customers a new range of mortgages, credit cards and other personal finance products through the UK's 17,000 post office branches.

The Post Office, in a £125 million tie-up with Bank of Ireland, wants to carve out a niche market in savings, loans and insurance products.

David Mills, CEO of the Post Office, said: "If we get 1 per cent of the UK personal finance market we would be very happy and if it's 5 per cent we would be delirious.

"We are going to compete head-to-head with the big banks and building societies. We're not going to compete with the likes of Smile or Egg or other internet-based products."

The Post Office will launch a pilot trial next week in the Midlands with the view to rolling out the services early in the New Year.

The venture has an initial term of 10 years.

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