THOUSANDS of people could have benefit payments stopped unless they take action.
Universal Credit claimants and those on state pensions have just months until Post Office card accounts will close
Post Office card accounts (POAs) are used by those who don’t have a bank account to get their benefit payments.
But the Department of Work and Pensions (DWP) it will no longer make payments to them from November 30.
Customers who currently receive payment into a POA will be sent a letter telling them the service is ending.
They will have to give the DWP details of a bank account where they will continue getting the payments.
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If they don't do this then they risk missing benefit payments.
If you don't tell the DWP which bank account you're moving to before the deadline, you'll be transferred. to the Payment Exception Service.
This will allow access to benefits, such as Universal Credit and the State Pension, through the PayPoint network.
Around 382,000 people use a Post Office card account, which can be used to withdraw funds with no fees or charges.
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What happens when the Post Office accounts close?
Your two options are opening a new bank account or accessing your payments via the Payment Exemption Service.
If you want your benefits payments to be made to a bank account then you will need to tell the DWP your bank account details.
You can do this over the phone by calling 0800 085 7133 or by post if you get a letter from the DWP or HMRC.
You also need to tell the Post Office to close your card account – make sure you withdraw any money first.
You can do this by completing an account closure form at your local Post Office, or calling 0345 722 33 44.
But if you're not able to use a bank, the Payment Exception Service might be your only option.
If you're transferred to this service, you'll be given a unique code which you can use either at a pay point retail outlet or the post office.
You can use the Payment Exceptions service either by using a payment card, voucher by email, or text message containing a unique reference number.
To access this service you will need to speak to your local benefits office, or respond to the letter about the Post Office card account closures that you received from the DWP.
How do I open a bank account?
The government's MoneyHelper service says you have three options for a new account:
- current account
- basic bank account
- prepaid card
If you don't qualify for a bank's current standard account, you're best to get a basic bank account.
So, if you've got poor credit history or have experience of serious money problems, you might not meet the requirements for a current account.
But pre-paid cards can also be used if you can't get a current account, although Martin Lewis has warned that they often come with expensive and unnecessary charges.
Make sure you research exactly what you're getting and whether you'll be charged extra fees before you sign up to one.
All three types of account can be used to deal with day-to-day spending and paying bills, as well as getting your benefit payments.
When you're researching, make sure you compare different bank companies to see who has the best offer.
You can check out MoneyHelper's guide to choosing the best bank account for benefit payments.
Here we explain all you need to know about finding a basic bank account and how to get accepted.
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If you need help opening an account or are affected by the Post Office card account closures you can find free and friendly help from the following services:
- Citizen's Advice
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