Background In 1959, the
Radcliffe Committee set up to investigate the "Working of the Monetary System in the United Kingdom" recommended the introduction of a
giro system, and said that if the main banks did not do this, the possibility of the Post Office introducing it should be investigated. The most prolific user of the National Giro was the British government, which used giro cheques to effect unemployment benefit and social security payments. These cheques were sent by post to the beneficiaries, who could cash them at a post office, and they became known colloquially as 'giros'. From 2003 such payments were switched to the electronic payments system run by commercial banks. In 1969 National Giro partnered with the
Mercantile Loan Company to provide loans to account holders, which was a significant stimulation of account growth. When a
Conservative government came to power in 1970, there were pressures on the government to close the still loss-making operation. The personal banking business of Girobank became part of the Alliance & Leicester Building Society. The business banking arm continued to use the Girobank name as a wholly owned subsidiary of the Alliance and Leicester, repositioned as a cash handler and credit card processor for retailers and other banks. In March 2009, a campaign was launched to bring back Girobank. Backers included MPs, trade unions and small businesses.
Successors Post Office Limited now provides cash services to many banks on a commercial basis. In April 2013, the Post Office announced it would be launching a retail banking service accessible through Post Office branches under the
Post Office Money brand, now run by the
Bank of Ireland. ==References==