Last year it cut its operating losses to
If post offices offered basic banking services, the postal service could easily scrape off 10 percent of the
That money is spent largely by the 68 million American adults who don't have bank accounts. They pay their bills with cash or money orders. The average unbanked household spends
The average payday loan is for
Now it might be argued that turning the post office into banking centers would be unfair to payday lenders, title lenders, rent-to-own centers and pawnshops. The proper response to that is, "What goes around, comes around."
This spectacular idea has been kicked around by policy wonks for years; indeed, until 1967 the postal service operated a kind a savings bank. But on
Another positive: The postal service owns or leases a lot of real estate -- 35,000 parcels. Thirty-eight percent of them are in ZIP codes where there are no commercial banks. Another 21 percent are in ZIP codes with only one bank.
(Of course, in many of these ZIP codes, there are lots of payday loan outlets, more than 1,000 of them in
So if this is such an obviously spectacular idea -- and to repeat, it is -- why hasn't it been adopted?
Part of the answer is inertia. The postal service likes being the postal service, not a bank, even if it means it has to close branches and stop Saturday mail delivery. Change is hard.
Change would require modifying offices and retraining personnel, but most business would be done electronically. The system could start by selling pre-paid cards that could be used to withdraw cash or pay bills, the IG report said.
Eventually, if a customer had his paycheck loaded onto his postal card, he could become eligible for a cash loan. The report suggests a
It's obviously a better deal than a payday loan, which is why the industry would fight it to the death. If we're lucky.
Big banks might hate it, too, even though unbanked customers are, by definition, not their customers. Payday lenders are. A study by the advocacy group National People's Action found that in 2009, major banks provided at least
Big banks have a lot of clout in
But this may be the very best part of the spectacular idea: The postal service may not need congressional approval to get into the banking services industry.
"The 2006 Postal Accountability and Enhancement Act (PAEA) generally prohibits the
This would be bold, an adjective not usually associated with the postal service. But it could do an awful lot of good for an awful lot of people who today fall victim to vultures, which liberals will like. It might encourage thrift and savings, which conservatives will like. Spectacular.
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