Post office at the crossroads
It is politics and special interests, not economic restrictions, that prevent the U.S. Postal Service from becoming the center of affordable banking and other valuable community services in the 21st century. But we need a new regulatory structure and new leadership to advance.
The public service mission of USPS is to provide a similar level of service to communities across the country, regardless of local economic conditions. In addition to delivering mail to remote areas every day, the post office also has post offices in low-income urban communities and small towns that lack other basic services. Thanks to economies of scale, the postal service can accomplish its mission while maintaining a low postage rate.
Once the fixed costs of the post office and delivery are covered, the additional cost of the new service is usually the lowest. If it is not prevented from doing so, the postal service can use its underutilized capacity to build Americans’ trust in the postal service, provide the public with new services, and generate the required revenue for the agency. But first, we need to abandon the regulatory framework that protects private sector competitors at the expense of consumers.
The most talked-about expansion idea is the revival of Post Bank’s business, although Advocate came up with From home delivery of perishable groceries to advanced health checks, it has it all. Before the post banking business ceased operations in 1967, the post office earned a small fee by managing basic savings accounts by cooperating with private banks that paid interest to account holders in exchange for loanable funds.As suggested Senator Sherrod Brown (D-Ohio) believes that the updated postal banking system can be combined with the government’s broader monetary system modernization efforts.
Once the fixed costs of the post office and delivery are covered, the additional cost of the new service is usually the lowest.
Although more and more Americans have stopped using cash in favor of debit or credit cards and online bill payments, many still face obstacles in using modern payment systems. These obstacles include bank branches”desert,” Minimum balance requirement, with Private issues. As a result, especially low-income Americans–Disproportionately People of color-usually end up paying high fees just to obtain and protect their own funds and carry out simple financial transactions, many of whom still “have no bank accounts” at all.Estimated fees paid by ordinary people using salary lenders and other alternative financial services 3,000 USD Annual fees and interest, but even families with bank accounts often face high basic service fees.
Maintain a safe Currency system As a store of value, an account system, and a means of exchange, it is a typical government service, as basic as defense against military attacks.But the government fell down on work, while the private sector Invaded-The most obvious is cryptocurrency, but high fees are also charged through ATM, check cashing and similar services.These service fees-and “trap” fees such as overdraft fees-are Increase share Bank income and contribute to underserved communities Distrust of the bank.
Through fast and secure electronic payments and the ability to verify the availability of funds, many fees and fines can be avoided.Big banks have established a private system for real-time transactions, but community banks and households are waiting for the Federal Reserve to establish a public system. This process has Madly slowOnce this system is in place, the next step is to create secure accounts for anyone who wants them, such as free accounts through the postal service proposed by Senator Brown and community bank access.
Like other neglected infrastructure, delayed investment in digital payment systems is costly, as in recent challenge Allow many families to receive COVID relief funds. In addition to increasing the financial pressure on families, this delay will also affect the timing and effectiveness of stimulus measures.Other government transfer payments-for example Child tax credit——Compared with paper checks or annual tax returns, regular electronic payments can also be processed better.
Post bank bill The proposal co-sponsored by Senator Kirsten Gillibrand (D-New York) and Bernie Sanders (I-Vermont) is more focused on postal services than Senator Brown’s bill, including small loans and high-cost lenders compete. This will require action by Congress, because a 2006 law restricts postal services to financial and other services similar to those already provided.In order to circumvent this restriction and address any concerns about postal service loan underwriting capabilities, some supporters of the Post Bank, including early backers Senator Elizabeth Warren (Massachusetts) and the former USPS inspector general David WilliamsIt is recommended that the postal service cooperate with credit unions and community banks. If they do not bear the cost of opening new branches, they can provide loans and other banking services at competitive prices in more communities.As Warren “This is just an opportunity for the post office to use its space and more effectively use its employees to provide more Americans with the services they need.”
The Post Office recently took a small step towards Post Banking, converting payroll and other business checks into one-time use debit cards in four locations in one area pilot It is scheduled to start in September. Although it is not a substitute for bank accounts, low-cost cheque cashing can help undocumented immigrants, people without a fixed address, and others who worry about or prevent bank accounts from opening high-fee outlets.Because of post Already provided Limited government check cashing and sales of universal gift cards, the pilot project is an extension of existing services and does not require Congress to approve the expansion to other branches.
However, in its current form, Post Bank’s business seems likely to fail.This is not only because the locations and services provided are too few to attract the attention of the public, but also because Terms can’t even compete with Walmart, Has a higher check limit and lower fees.
The union representing postal staff is working hard to solve this problem, but there are legal, regulatory, and institutional obstacles in extending financial services beyond check cashing, bill payment, wire transfer, and ATM.Even if Congress revokes the provision in the 2006 bill that restricts the menu of services provided by the postal service, the Postal Regulatory Commission will need to sign service and pricing, and tends to interpret its duties as Block USPS competitors From what it considers to be unfair competition, rather than focusing on what is best for consumers.
at the same time, Scandal-ridden Postmaster Luis Dejoy is still at the helm, intending to pass Outsourcing work with Cutting service, For his former employer and other special interests.President Biden, who Support Post Bank, There is an opportunity to nominate members of the Postal Services Council before December, and they can form a majority of seats to dismiss DeJoy.But he has not announced his choice of position, the current position Ron BloomIt is an unabashed supporter of DeJoy and its controversial service slowdown, and is likely to be reappointed.
Postal banking business is closer to becoming a reality than it has been in half a century.Despite DeJoy’s mismanagement, the postal service is still the most popular And trustworthy American institutions are equally praised by Republicans and Democrats. We should build on this trust-and the underutilized capacity of the post office-to provide more services that Americans need and want. It is worthwhile for Congress and the government to take the time to think seriously about how to remove the obstacles to this work.