Postal Banking Pilots are an Alternative to Predatory Firms

The ultimate goal of the pilot project initiative would be to offer such services nationwide. USPS is well-placed to handle this expansion. Postal employees already handle money orders and some other limited financial services, but there is tremendous untapped potential to utilize the 31,000 post officesaround the country to provide trusted and affordable financial services.

Postmaster General Louis DeJoy already has the authority to expand basic financial services, including check cashing services, and the idea of a pilot projects has been floating around for years. But in his recently released 10-year plan, DeJoy made no mention of this issue. A mandate from Congress would final get the ball rolling.

The timing couldn’t be more critical.

An expansion of postal financial services would help low—income Americans save money as they struggle to get back on their feet from the crisis. Research shows that the rate of people taking out payday loans has tripled during the Covid-19 pandemic, and as people continue to receive unemployment and stimulus checks, check cashing services are making a killing off of the needs of the people.

Wire transfers have also boomed during the pandemic with people providing remittances to overseas friends and families in need.

Postal banking could also be a boon for the bottom line of the Postal Service.

“One in four households in the U.S. doesn’t have access to affordable financial services…But everyone has a post office,” Porter McConnell from the Save the Post Office Coalition said. “Piloting non-bank financial services at the post office would save working families in these communities thousands of dollars and would ultimately bring in over a billion dollars in revenue for the Postal Service every year.”

Expanding postal services is a win-win for everyone — except the predatory financial firms.