Benefits and state pension claimants will be able to carry on visiting the Post Office to receive their money.
It has been announced that the Post Office is to keep its contract to run the card account, which is used by millions of consumers to receive their pensions and benefits.
The organisation had faced competition from a rival firm, but the government has confirmed that the bidding process has now been closed and the Post Office has been awarded the five-year deal, which begins in 2010.
Work and pensions secretary James Purnell insisted the decision was the right one for consumers across the UK. He said the Post Office is seen by many people as "safe, secure and reliable" and insisted: "Now cannot be time for the government to do anything to put the network at risk."
Subpostmasters and unions have welcomed the announcement, claiming it will save as many as 3,000 Post Office branches from closure. Mr Purnell said this was taken into account, alongside the social role that the Post Office plays in the lives of many older people.
The Post Office card account can be used to receive benefit, state pensions and tax credit payments. It will not let account holders go overdrawn or incur any charges. Customers can withdraw cash free of charge at Post Office branches using a card and a PIN number.
Compare current accounts via money.co.uk
