Post Office retailers claim they are being ‘priced out’ of providing the National Lottery as Allwyn requests payments of £1,500 upfront bonds to continue offering the service.
The firm has been urging retailers to complete a Transfer of Retailer Agreement (TRA) from Camelot to Allwyn since August, and this week, claimed more than 75% of independent lottery partnered stores have done so.
better Retailing understands that postmasters have been given four possible application outcomes, including being able to offer the service without a bond; with a bond; being told to provide more information; or an immediate fail.
This marks the first time postmasters have ever had a direct relationship with the National Lottery operator, as previously, the Post Office liaised with Camelot on their behalf.
In an email sent to a retailer today who’s been told they must pay a bond, and seen by better Retailing, Allwyn outlined the next steps postmasters must take to continue selling National Lottery products in their store from 1 February 2024.
This involves completing a DocuSign pack, containing a National Lottery Retailer Agreement and Fourth Licence Retailer Agreement Addendum by 18 December “at the very latest”.
An anonymous retailer, who has been told they will need to pay a bond of up to £1,500, explained how the value is “equivalent to a year’s worth of extra sales”.
They added: “Allwyn had been upfront about the possibility of paying a bond. We are in a fortunate position that we can pay this upfront, but a lot of other retailers aren’t, and this could cause them huge cash flow problems.
“I do understand why Allwyn feels justified to ask for a bond, but I’d rather they didn’t. There is a lot of risk involved operating the service, too. There is no denying the National Lottery is causing postmasters a lot of problems right now.”
A spokesperson for Allwyn responded: “We’ve had to carry out our standard ‘Change of Proprietor’ checks – including a credit check and verification of documents. We’ve also carried out an additional review of trading history – with a view of ensuring these Post Offices had the best opportunity to continue as a National Lottery retailer in the Fourth Licence. This includes giving Post Offices who might not usually qualify for The National Lottery the opportunity to do so upon receipt of a security bond (which will need to be paid by 15 January 2024 at the very latest).
“Where a bond has been requested for certain stores, the bond amount requested is set at £1,500 for independent Post Offices with an Altura terminal and £1,000 for independent Post Offices with a Compact Lottery Terminal (CLT).
“We’d like to thank these retailers for their understanding of this wholly unique situation and hope that they are able to meet the bond requirements in order to continue selling The National Lottery, helping to raise over £30 million for Good Causes every week.”
It’s also understood that partnered stores earn £6,000 a year in commission from operating the National Lottery.
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