Business secretary Lord Mandelson has announced an expansion of the financial services offered by the Post Office, including a range of mortgages.
The Post Office will offer a 90% LTV mortgage product aimed at first-time buyers. It will also increase its lending substantially, aiming to double the value of its mortgage book in the financial year 2010/11. The organisation has not given any more details about the products it will offer but says it wants to target individuals on low incomes.
The Post Office also plans to launch a Saving Gateway account for those on lower incomes, with the aim of boosting the savings habit in that group. The government would add 50p to every pound saved.
Mandelson says: “Since the banking crisis we have set about reinventing the financial services industry, building a system that is fairer, more trusted and more responsible. This is the next step in that process. The Post Office is a well loved community institution and this move will bring banking services back to the heart of those communities.”