Thursday 3 March 2011

Tiddlywinks, tokens -- or library cards

250,000 benefit claimants who receive their money in the form of Giro cheques will soon be moved to a different dort of payment. It will happen at shops which display the PayPoint logo, but how will it work?

The Department for Work and Pensions says benefit recipients will get a "token", but officials are very cagey about what form that will take.

It appears that the new system hasn't yet been fully worked out.

Is the token like a tiddlywink? Probably not.

Is it a swipe card, which will have personal information stored on it? We don't know.

The token would have a reference number or bar code on it, I understand. And claimants or their carers would need to show I.D. as well.

This is what PayPoint says: "Similarly to the cheque payments which are being replaced, customers will be supplied with a document to confirm their entitlement that can be cashed in a PayPoint retail outlet."

This sounds a bit like a paper voucher, a cheque by another name. Only a cheque has to go through the costly cheque clearing system.

Cheques are open to fraud, says the DWP, but might not the vouchers be open to fraud as well?

Another thought: it sounds as though claimants or carers would have to register with a particular PayPoint outlet, for identification purposes.

So they could choose where to go, but might not be able to use other PayPoint outlets thereafter out of 22,000 available.

UPDATE from Department for Work and Pensions: it's a library card!

"Current system is that we post a cheque to benefit recipients and they take it to the post office to cash it.  They will take the cheque and some form of ID eg driving licence, passport, utility bill etc.


In future people will have a 'token' of some sort - this will be like a library card.   This is a security measure. They will also need some form of ID eg driving licence, passport as above. People will go to their local Paypoint exactly as above, and get their cash."



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