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USPS IG Promotes Post Office Banking

Cujo359's picture
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In an op-ed in the Los Angeles Times today, United States Postal Service inspector general David C. Williams advanced the idea of offering banking services like checking accounts and consumer loans at US post offices. As he noted:


Drive through the dilapidated main strip in Terry, Miss., and it's easy to see that the town of 1,063 is a hardscrabble place. And last month, life there got harder when the last bank branch in town closed, leaving in the lurch residents who have long depended on it as a convenient place to manage their money.

The same thing is happening in countless other small towns and inner-city neighborhoods across the country, which have been left behind as banks adjust to new financial realities by shuttering branches by the thousands. The vast majority of the closures have hit poor areas, and residents are often left having to rely on other types of costly financial services.


Williams goes on to note that most of those small towns have a post office, which in times past was a place where elementary banking services were available:

This is not a radical idea. Many foreign post offices, including those in Britain, France, Brazil, New Zealand and Italy, offer financial services. In fact, globally, an average of 17.7% of postal revenue comes from financial services. In that sense, our Postal Service is the notable exception.

And it wasn't always that way. The Postal Service ran a successful, popular bank for more than 50 years that needed no bailout. The service was ended ultimately because of restrictions on the interest it could pay.


I don't know if anything good for ordinary Americans can come out of the current Congress, but at least the Obama Administration seems to be onboard with the idea.

(h/t David Dayen)

Comments

Alexa's picture
Submitted by Alexa on

I hope it's successful--maybe then they'll continue to allow their postal branches to stay open for half-a-day.

I know we're very happy that they've not cut off Saturday mail delivery (even though we do less and less through snail mail).

But there are many people who don't use computers, who REALLY need this service. It would be so wrong to inconvenience and/or hinder all these people.

Not to mention, totally unnecessary.

Alexa

“If a dog won’t come to you after having looked you in the face, you should go home and examine your conscience.” -- Woodrow Wilson

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Cujo359's picture
Submitted by Cujo359 on

Yes, and I suspect that there are more such people (who don't have computers) in areas that haven't seen economic expansion in a while.

I still can't get over that the law requires USPS to project out pensions 70 years. It's as though they want the thing to fail. ;)

Submitted by lambert on

Combine:

4. Job and Income Guarantee

and

7. Post Office Bank

and a second-order concrete material benefit is that abused spouses have a lot better chance of escaping their situation: No more joint bank account crapola, and an independent income.

First they ignore you, then they ridicule you, then they fight you, then you win. -- Mahatma Gandhi

Cujo359's picture
Submitted by Cujo359 on

Another would be that, thanks to lower income people no longer having to depend on payday loan/check cashing outfits, they'll have more money to spend on other things they need.

It's a great idea, even if the only benefit is that people in really small, isolated places have banking, but there are plenty of other benefits from having a financial institution that can operate locally and efficiently.

Submitted by lambert on

First-order concrete material benefit.

Plus the socially positive aspect of not being upsold by sleazy salespersons pushing financial "products."

First they ignore you, then they ridicule you, then they fight you, then you win. -- Mahatma Gandhi