Payment of Pension Credit
How is Pension Credit paid?
Direct Payment
Pension Credit is normally paid direct into an account. Customers can use a bank, building society or credit union account. They can also use a Post Office® card account (POca).
The advantages of Direct Payment for customers are that:
- it is secure and convenient
- payments cannot be delayed or go missing in the post
- they can choose how and when they get their money, including through:
- cash machines
- cashback facilities, offered by many retailers
- over the counter at banks and building societies
Many banks and building societies also have arrangements which allow customers to collect their money over the counter at Post Office®.
Customers must tell us straight away if they change their account or if they think the wrong amount has been paid in.
Opening an account
If your customer does not have a suitable account or does not want to use the one they have (for example a joint account) any bank or building society will help them open an account that suits them better. The customer should remember to ask if the account allows the collection of money from the Post Office® if this is important to them.
If your customer has problems opening a current account or if they are worried about being overdrawn, they could ask any bank or building society about opening a basic bank account. Basic bank accounts are available from all major banks and offer free banking with no overdraft facility. They allow money to be paid in, bills to be paid automatically and many of these accounts allow cash to be collected at the Post Office®.
Alternatively, your customer could have their Pension Credit paid into a Credit Union account. Customers who request Direct Payment into a Credit Union account are normally asked to contact the relevant Credit Union to discuss the ways they can access their money, before deciding if it is the appropriate account option for them.
Some customers may ask about opening a Post Office® card account (POca).They should be made aware that: there is no direct debit facility to allow customers to make savings on some bills; no interest is paid on balances; a POca can only be in the customer’s name i.e. they cannot have a joint account; under the terms and conditions of the POca, customers must have their pension paid into their own POca and not into the account of someone else; the POca is not suitable if customers have different people collecting their money for them (although a POca does support Secretary of State appointee arrangements).
Getting someone else to collect payments
Account payments
If your customer’s Pension Credit is paid into an account and they are unable to collect the money, they can either:
- ask their bank or building society if arrangements can be made for someone else to collect the money, or
- arrange with us to have their money paid into the account of a person who is acting on their behalf; for example the customer’s attorney or appointee.
Post Office® card account payments
If your customer’s money is paid into a Post Office® card account and they are unable to collect it, they can apply for someone they trust to have permanent access to their account and collect the money for them. They need to ask at their local Post Office ® for an application form to set this up.
Cheque payments
If your customer receives DWP payments by cheque, someone else can cash the cheque on their behalf if necessary. Your customer simply signs the back of the cheque to make it payable to another person. The person cashing the cheque will need to provide proof of both your customer’s and their own identity to cash the cheque.
You should make your customers aware that the Department will be replacing cheque payments with a new service. The service will offer the same flexibility as the cheque in allowing single or multiple carers to collect money on behalf of the customer.
Appointing someone to act on a customer’s behalf
We can appoint someone, usually a family member or close friend, to act on the customer’s behalf for everything to do with social security. See the Agents, Appointees, Attorneys and Deputies Guide for further details.
