The Department for Work and Pensions (DWP) has announced that Post Office Card Accounts (POCa) are to be extended for another year in order to safely move existing benefit claimants over to traditional bank accounts or a new Payment Exception Service.
The POCa scheme is used by claimants to collect benefits including State Pension, Child Benefit, Universal Credit and Tax Credit s at any Post Office counter and was previously set to end in November this year.
However, following the disruption caused by the coronavirus pandemic, the DWP has now extended it for 12 months to ensure everyone has the time to make alternative arrangements.
The POCa service closed to new DWP benefit claimants, including people who had reached State Pension age and were eligible to claim, on May 11, 2021.
From January 2021 to July 2021, the number of active POcas reduced from 590,000 to 382,000.
At its peak, around 900,000 people across the UK were using the Post Office to collect payments, but over the last three years the DWP and HM Revenue and Customs (HMRC) have been writing to claimants and encouraging them to have benefits and pensions paid directly into a bank account instead.
The DWP has said that those who remain unable to access such services will be migrated onto a new Payment Exception Service, which allows them to choose how they receive their payments.
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.”
Under the new Payment Exception Service, pensioners and benefit claimants are able to choose how they receive their payments.
These methods include the delivery of digital vouchers via:
- a SMS
- an email
- a unique barcode displayed on a mobile phone
In addition, all claimants who are migrated from POca to the new service will receive a reusable mag stripe plastic card, which can be used to receive their benefits in cash from more than 28,000 PayPoint retail outlets or 11,500 Post Office branches.
The DWP also said that extensive work has been done to identify those most at risk in order to provide vulnerable claimants with additional support before the move to the new system.
It also said that checks will be made when customers are moved to the Payment Exception Service to ensure vouchers are being cashed.
For more information about the Payment Exception Service, visit the GOV.UK website here.
What will happen to my benefits or State Pension payments after November 2022?
Your benefits or State Pension payments will not stop, and your payment dates will not change.
The only change is that you will no longer be able to use a Post Office Card account to withdraw your money.
If you are still using a Post Office account to collect Universal Credit, Tax Credits, Jobseeker’s Allowance, Personal Independence Payment (PIP), Disability Living Allowance (DLA), Employment Support Allowance (ESA), Child Benefit or any other benefit from DWP or HMRC, you should open a bank account as soon as possible and inform the relevant department of the change in payment details.
You can find out more about the letter you will receive and the steps you need to take on the Post Office website here.
You can also contact the Post Office contact centre on 0345 722 3344.
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What do I need to do now?
You will have three options to receive pensions and benefits payments after November 30:
1. Use an existing account you have with a bank, building society or credit union
2. Open an account with a bank, building society or credit union
3. Payment Exceptions Service – if you are unable to use or set up a bank, building society or credit union account, the Uk Government will get in contact with you about this option
How to close a Post Office Card account
Eventually, you will also need to tell the Post Office to close your Card account.
You can do this by completing an account closure form at your local Post Office, or calling 0345 722 33 44.
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