Post Office card accounts are to be extended for another year in order to safely move existing users over to traditional bank accounts.
The Post Office card accounts (POca) scheme was previously set to end in November this year but after disruption caused by the coronavirus pandemic it has now been extended for 12 months.
The changes come about to ensure everyone has the time to make alternative arrangements for their benefits payments.
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The Department for Work and Pensions (DWP) is writing to all customers who currently receive payment into a POca to make them aware that the scheme is closing.
The DWP are encouraging all users to open a bank account if they are able to but anyone who can't access a bank account will be migrated to a new Payment Exception Service.
Extensive work has been undertaken to identify those most at risk in order to provide vulnerable claimants with additional support before the move to the new system.
Minister for Pensions, Guy Opperman, said: "Whilst the vast majority of pensions and benefits are paid directly into peoples’ bank accounts, some people prefer to collect their payments over the counter at their local Post Office.
"This extra time means we can support our most vulnerable customers to move to the payment method that will suit them best – even if that means making sure they can still get cash via the Post Office using a card from the new Payment Exception Service."
The new Payment Exception Service will allow pensioners and benefit recipients to choose how they would like to receive their payments.
The methods of payment include the delivery of digital vouchers via a SMS, an email or a unique barcode displayed on a mobile phone.
The new service will also provide a reusable mag stripe plastic card, which can be used to withdraw payments in cash from more than 28,000 PayPoint retail outlets or 11,500 Post Office branches.
Checks will be made when customers are moved to the Payment Exception Service to ensure vouchers are being cashed.
If you are a claimaint of tax credits, Child Benefit or Guardians Allowance you will need to provide HMRC with alternative bank details by April 5, 2022.
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