Why We Need A Bank at the Post Office

Original Article: https://www.campaignforpostalbanking.org/news/why-we-need-a-bank-at-the-post-office/

This is a repost and summary of information from a news article "Why We Need a Bank at the Post Office," by John Nichols of The Nation on February 11, 2014.

I'm someone who lived unhoused for roughly four years. I've broken bread with thousands of people on the streets and have listened to their stories. A large barrier to people improving their situations while unhoused, is access to banking.

This idea for Postal Banking is not mine. It has been championed by Senator Elizabeth Warren for over a decade. Postal Banking would provide basic services to millions of underserved Americans.

“If the Postal Service offered basic banking services—nothing fancy, just basic bill paying, check cashing and small-dollar loans—then it could provide affordable financial services for underserved families, and, at the same time, shore up its own financial footing,” says the senator from Massachusetts.

It really is possible to do two good things at once: address the abuse of the working poor by payday-loan and check-cashing outfits while expanding the range of services provided by the USPS.

A study from the Postal Service's Office of the Inspector General found roughly 68 million Americans are underserved by private banking.

'Post offices and postal workers are already on the ground. USPS could partner with banks to make a critical difference for millions of Americans who don't have basic banking services.'

From 1911 to 1967, the Postal Service maintained its own banking system, allowing citizens to open small savings accounts at local post offices—actually a better approach than “partnering” with banks. The system was so successful that after World War II, it had a balance of $3 billion, roughly $30 billion in today’s dollars. Congress did away with postal banking in the 1960s, but post offices in other countries—including Japan, Germany, China and South Korea—provide banking services. Japan Post Bank is consistently ranked as one of the world’s largest financial institutions based on assets.

Postal banking has since gained traction with postal unions, which have been fighting to save the USPS—both by easing irresponsible congressional requirements for pre-payment of retiree benefits seventy-five years into the future and by expanding the range of services that post offices provide. In 2012, delegates to the National Association of Letter Carriers convention backed a resolution that declared, “A USPS bank would offer a ‘public option’ for banking.” The new president of the American Postal Workers Union, Mark Dimondstein, wants the USPS to provide “a nonprofit alternative to the big banks” that “would give the working poor an alternative to the legal loan-sharking they are now victimized by. It also would provide another source of revenue.”