Page 4 - Eurogiro News May2011_web version

4 Eurogiro News

The first Giro Account

Since January 2011, ELTA has offered payment accounts which can be used exclusively for payment transactions. This means interest-free current accounts. ELTA has a wide range of payment services in its portfolio, from Money Orders, to bill collection, pensions and social benefts. ELTA has created a unique and very com-petitive service by combining its traditional strength of reaching every customer and its new position as Payment Provider. For instance, a customer’s current account can be used to collect pensions or social

security and a postman from the Hellenic Post can pay out funds from the account direct in cash to the customer at home. The unique reach of Hellenic Post is a com- petitive advantage while cash is still essen- tial to customers. And when account transfers gradually take over, Hellenic Post has an attractive account to offer as well.

The regulation

Two major legislations changed the mar-ket conditions for Hellenic Post. One was the PSD, which opened the way for Hellenic Post to achieve its status as Payment Provider. The other was the New Greek Social Security and Labour Law which stipulates that a citizen must have a current account to receive payments from the entire public sector (be it salaries, pensions, subsidies or benefts). With the PSD, ELTA was granted the right to offer current accounts and to participate in domestic clearing, called DIAS. The security and labour law stipulated that these accounts could be held either at ELTA’s post offces or at a bank in accordance with the customer’s choice. These accounts make up a huge opportunity for ELTA to win its share of the growing account base in Greece.

The transition

When Hellenic Post achieved the status of Payment Provider and could offer current accounts and participate in the payment system formerly exclusively used by the banks, it led to direct competition with the banks in Greece. It also sparked a strategic decision within ELTA to enter into an advanced model of postal banking,

The PSD opens up to new business in Hellenic Post

The Payment Services Directive (PSD) was implemented in Greece in July 2010 and it paved the way for a new business line of Hellenic Post (ELTA). ELTA was approved as a Payment Provider shortly afterwards and now offers Giro Accounts and participates in domestic clearing. This is a spectacular success

Stefanos Rizos, Director Financial Products Unit, Commercial Division

[email protected]

Hellenic Post, ELTA, has opened quite a number of Giro Accounts since 1 January 2011

Three elements were essential to this implementation success of the Giro Account:

> The transposition of the PSD in Greece which enabled ELTA to become a Payment Provider from September 2010 and participate in domestic clearing

> The Social Security Act (no.3863) which required benefciaries of social benefts to open an account, and allowing such accounts to be held with ELTA

> An intensive marketing campaign to launch the Giro Account, and com- bining the service with a pay-out by the postman at home

Hellenic Post launched Greece’s frst Giro Account in January 2011. Around 850,000 citizens had opened one by April. An extraordinary result and a very good and promising business for ELTA

while retaining the advantage of offering the traditional postal fnancial services. The result was daunting. Since January 2011, ELTA has opened more that 850,000 Giro Accounts after an intensive marketing campaign. These accounts ease the daily lives of customers in relation to retail banking. For ELTA, the new business opportunity yields a remarkable turnover of ELTA’s total fnancial business. 3