An Post, the state postal service, will tomorrow launch a banking operation that over the next five years aims to take 5 per cent of the retail banking market.
Postbank, a joint venture with Belgian bank Fortis, will initially operate out of 250 post offices nationally, rising to 1,000 over the next 12 months.
The venture will employ 250 people at the outset, 100 of which are new jobs.
Speaking at the official launch of the €112 million venture yesterday, Minister for Communications, Noel Dempsey, said that while the financial services sector in Ireland was already highly populated, there was definitely room for a community-based offering from a group such as An Post.
He said that the service offered by many of Ireland's existing banks was far from customer friendly and that a new banking offering from An Post was very well-placed to benefit from the positive role post offices already play in many local communities.
"There is a strong financial services sector here in Ireland, but I believe very strongly that there is room for a bank offering that's doing something different, approaching things differently and that's why I think Postbank has a clear advantage," he told the group gathered at St Andrew's Street post office in Dublin for the launch.
According to An Post, 40 per cent of adults visit a post office once a week with more than three quarters visiting once a month and these are exactly the people Postbank is seeking to attract as its customers.
"That is who we want as our customers, the general public," said Margaret Sweeney, Postbank's chief executive - "anyone who wants simple, transparent, honest banking services."
From tomorrow consumers will be able to avail of what Ms Sweeney calls a "very favourable" interest rate on a "very simple" deposit account - exact details of which are to be released later today - and another separate investment product at 250 different post office outlets around the country.
Over the course of the year, and in response to customer demand, the range of products will be expanded to include current accounts, loans, credit cards, ATM services and web-based banking.
The aim is to have all of these in operation by the end of the year, according to Ms Sweeney.
The timing of the launch is also significant, given that the last-remaining special savings incentive accounts (SSIAs) mature this week, said Mr Dempsey.
This puts the bank in a good place to attract lump-sum deposits from those looking for a new home for their SSIA once it matures or for others who want to continue saving on a monthly basis but are looking for an alternative option to their existing bank.
Ms Sweeney said that, unlike many other savings accounts, Postbank wouldn't require customers to pay their salary into the account in order to earn interest and the small print relating to the terms of each Postbank product would be minimal.
Postbank is aiming to have a workforce of 500 within the next three years.
