Postal banking: A realistic and trustworthy alternative to big banks

[LuckyTheDog]

Each year, the average underserved household spends $2,412 – nearly 10 percent of gross income – in fees and interest for non-bank financial services. These transactions might include a payday or car title loan, cashing a paycheck, or simply accessing Social Security benefits. As United for a Fair Economy puts it, “Each year, over $103 billion is stripped from these people and their communities and ends up in the hands of Wall Street. For the underserved, there is little opportunity to create a credit history, have access to affordable, safe and sustainable financial services, or build assets over time.”

Is there an alternative? What if a trusted, accessible, and non-profit institution (that receives no tax dollars for operating expenses) with the world’s largest retail network (31,000 branches serving every urban, suburban, and rural community in the country) existed that could help fill this void?

Well, actually, it does exist. It’s the United States Postal Service.

MORE HERE: http://yonside.com/postal-banking-alternative-trustworthy-to-big-banks/

[myrna minx]

1. All of the letter carriers I know love this idea and I do too! k&r

[Kingofalldems]

2. We need to get the House and Senate.

repubs won't let this happen, in fact they want the USPS destroyed.

[newblewtoo]

29. which will

require a change to the constitution.

The Constitution and the Post Office

https://about.usps.com/publications/pub100/pub100_005.htm

In June 1788, the ninth state ratified the Constitution, which gave Congress the power “To establish Post Offices and post Roads” in Article I, Section 8. A year later, the Act of September 22, 1789 (1 Stat. 70), continued the Post Office and made the Postmaster General subject to the direction of the President. Four days later, President Washington appointed Samuel Osgood as the first Postmaster General under the Constitution. A population of almost four million was served by 75 Post Offices and about 2,400 miles of post roads.
The Post Office received two one-year extensions by the Acts of August 4, 1790 (1 Stat. 178), and March 3, 1791 (1 Stat. 218). The Act of February 20, 1792 (1 Stat. 232), continued the Post Office for another two years and formally admitted newspapers to the mails, gave Congress the power to establish post routes, and prohibited postal officials from opening letters. Later legislation enlarged the duties of the Post Office, strengthened and unified its organization, and provided rules for its development. The Act of May 8, 1794 (1 Stat. 354), continued the Post Office indefinitely.
The Post Office moved from Philadelphia in 1800 when Washington, D.C., became the seat of government. Two horse-drawn wagons carried all postal records, furniture, and supplies.

Republicans can just take a flying <bleep> at a rolling doughnut on that one.

[tom_kelly]

39. Even if we had both chambers, I

doubt this would pass. The banks have too many dems on their payrolls.

[2cannan]

3. One of Bernie's ideas...

Bernie Sanders's Highly Sensible Plan to Turn Post Offices Into Banks
http://www.theatlantic.com/business/archive/2015/10/bernie-sanders-lets-turn-post-offices-into-banks/411589/

[wallyworld2]

12. for years

Senator Sanders has been recommending we do just that
and
You would never know that with this M$M

[scscholar]

52. Got a link to that claim?

I'd love to see fewer post offices closed. My local one closed and was replaced with a motel.

[wallyworld2]

54. Nope

It was from back in the old Air America days on a Brunch With Bernie segment on Thom Hartmanns show

[Piedras]

4. Postal Banking is an excellent idea.

Postal Banking would be excellent for many millions of people. Postal Banking would also strengthen the U.S. Post Offices viability as a public institution. Weakening the awful grip of payday lenders on the poor, desperate, those under served by banks would help lift many, many peoples lives for the better.

[zalinda]

6. But DWS HATES this idea

and don't you know she is one hell of a Hillary supporter.

Z

[Doctor_J]

5. I wonder if this subject can be found in any of the transcripts of those speeches...

And what Mrs Clinton's wall street supporters think about having those $2412 rakes cut off.

[LanternWaste]

40. I wonder if there are any minds disciplined enough to avoid irrelevancies...

I wonder if there are any minds disciplined enough to avoid irrelevancies on a particular topic (though no doubt, that same lack of discipline is more than made up for with creative justifications soon to follow...).

[silvershadow]

7. K&R. I would love for Hillary to adopt this too, if she ends up being the nominee. nt

[djean111]

30. Nothing that takes profits away from the banks is going to happen under a Hillary

administration.

You can take that to the bank.

[LanternWaste]

41. Prophecies are important to people during troubled times.

Prophecies are important to people during troubled times.

[mac56]

47. So is repetition, apparently.

So is repetition, apparently.

[SammyWinstonJack]

70. Ha!

[SammyWinstonJack]

69. ROFL!

[appalachiablue]

8. WE had this 1911-1967, same in Europe and other places as the article notes.

K & R. Let's do it again!

[raging moderate]

26. You are right, and it worked fine.

I remember it.

The Post Office was just FORCED by Congress to lower the price of stamps. Just when Congress is screaming that the Post Office doesn't take in enough money.

[TryLogic]

9. I'm for it.

But, no way is Hillary for it, even if she were to say she is.

[snort]

10. Madame Presidents bosses won't like this idea.

It's a no go for the money pigs.

[tomm2thumbs]

14. the NEW Democratic Party - where good ideas go to die

if we don't start thinking along new lines, and dealing with the truth, the next generation is going to leave the Democratic Party and find an alternative, because the truth can never be walked back

[snort]

19. Fully agree.

I hold out hope that Sen. Sanders and his followers can effectively jump start a viable new party. I know I am in. Like a product, the initial appeal will be found in the right name, otherwise I fear we will end up with another Green Party, well meaning but going nowhere.

[RufusTFirefly]

11. No wonder DiFi's hubby is in such a hurry to sell off postal sites

The idea won't work if we have no post offices left.

[Algernon Moncrieff]

13. A better alternative to big banks - credit unions

Where the USPS can do well is the tertiary market - ie check cashing companies.

[RufusTFirefly]

15. Totally agree. But we can have credit unions AND postal banking

(A credit union member and postal banking fan)

[LuckyTheDog]

34. I think we need both

We need more credit unions and also postal banking.

[LS_Editor]

16. Republicans are trying to kill the Post Office.

They will only let it get into banking if it loses money on every transaction so it can die faster.

[appalachiablue]

38. GOP is trying to kill the USPS because it has the largest unionized workforce left in the US.

That's why Bush passed the 2005 bill to make the US Post Office fund millions in retirement money 75 years into the future, before some workers are even born! They want it to fail, 'starve the beast', to be broken and privatized.

The USPS also has been blocked from providing many other services like notarizing documents, check cashing, wiring funds, photocopying, printing and faxing which would help bring in revenue. They do offer money orders which is good.

Bring back postal banking services and support credit unions and local community banks! It's good for America!

[SickOfTheOnePct]

17. I'd first want to see how it will be financed

I'm not a fan of our local post office - won't use it unless there is no other alternative. But this sounds like a good idea, depending on how it's paid for.

[eridani]

25. The exact same way it was financed up until 1967 n/t

[SickOfTheOnePct]

28. And how was that?

Many fewer people even use the postal service now than they did 50 years ago. With additional services come additional employees - a good thing, but it has to be paid for. I'm just wondering how that will be done.

[eridani]

57. With government funds

http://www.slate.com/articles/news_and_politics/history/2014/08/postal_banking_already_worked_in_the_usa_and_it_will_work_again.html

Of course we would have to get rid of that stupid Repuke bill that required the post office to fund the retirements of workers who haven't been born yet.

[SickOfTheOnePct]

61. The postal service doesn't take government funds

It's self-supporting.

So, how will banking services be financed?

[eridani]

62. Easy--put the money now used on bullshit pension funding into it. n/t

[SickOfTheOnePct]

64. At best

not funding the future pension requirements brings the postal service to break even.

There will have to be fees associated with banking services, or the postal service will continue to lose money.

[eridani]

74. Any fees area vastly less expensive than payday lenders charge. n/t

[SickOfTheOnePct]

76. Very true

But I'm talking about the basic banking functions - cashing checks, etc.

No way under any circumstances should the postal service get into the business of making loans.

[eridani]

77. Until 1967, we had basic postal banking which did NOT involve makine loans. n/t

[SickOfTheOnePct]

79. I know that

but if they aren't making loans, they aren't going to cut into the pay day lending business.

[Jesus Malverde]

80. What is the percentage check cashiers take?

Charge half that.

[SickOfTheOnePct]

83. No idea what they charge

but that sounds like a viable option; or even less. It shouldn't be a profit center (to make up for other shortfalls), but if they're going to do it, it should be self-supporting.

[hunter]

18. Enthusiastically recommended.

It would create more jobs for honest local people behind the postal counter too.

But perhaps the greatest benefit would be putting the predatory check cashing and payday loan places out of business.

[SickOfTheOnePct]

20. I agree it will help

those who need a place to cash checks without huge fees, but I don't see how it will help those who take out payday loans. Those folks are taking out loans because they can't make it to the next pay day. Unless a postal bank is going to be a lending bank as well, I'm missing how it will help with those situations.

[hunter]

21. There's nothing wrong with an overdraft capacity having non-usurious interest rates.

Sucks for 30% interest VISA card sellers, however...

[reACTIONary]

23. Yes there is...

...the payday lenders are lending at a hugh risk of not ever being repayed. This results in losses and expenses that have to be covered by userious rates. As a public institution, the post office wouldnt be allowed to use effective collection techniques and wouldn't be able to charge enough to cover the loses and expenses.

Money would walk out the door, and never come back. And the taxpayers would be expected to make up the deficit .

[TransitJohn]

60. Gave yourself away with the use of Hugh!

[reACTIONary]

65. So, do you have...

..... anything of substance to say?

[TransitJohn]

72. Blue cantaloupe unicorn!

Squid food airliner sourmash!

[reACTIONary]

86. Sheesh . ... Stop making sense. eom

[reACTIONary]

22. You want the post office to be...

..... lending money ? And be responsible for collecting delenqent accounts ? Maybe reposessing cars?

I don't think that's going to work out. They're going to be handing out money and not be able to enforce repayment. They will lose, lose, lose revenue and the taxpayers will have to pick up the bill.

[LuckyTheDog]

35. That is nonsense

Why would the Postal Service be less able to make loans than local credit unions? The notion that people would be less likely to pay back loans to a postal banking system vs. other lenders has no obvious merit.

[1939]

58. Most of the people getting payday loans

would not qualify for a loan from a credit union.

Right now the only choices they have are the payday loan outfits or back alley loans.

[Heidi]

44. It has worked just fine here in Switzerland since 1906.

https://www.postfinance.ch/en.html

[1939]

67. Only problem is

They only do mortgages, not unsecured loans like the payday lenders.

[Dont call me Shirley]

24. Bernie advocates for USPS banking. It's a great idea.

End Rule By Psychopaths!

[Cosmic Kitten]

27. Support the Commons

[Adrahil]

31. Could that kill local banks too?

I have a pretty great local bank. I'd hate to see it go away.

[LuckyTheDog]

36. I don't see why it would do that (nt)

[Adrahil]

49. WEll, if this plan is intended to compete with Big Banks...

Wouldn't it compete with little banks too?

I should be clear, though... I find the idea attractive.

[LuckyTheDog]

50. It is intended to compete with payday lenders

It's not like small local banks do a great job of serving poor communities. If they did, postal banking wouldn't be needed.

[1939]

68. The only service it would do would be check cashing

As pointed out in several posts above, the USPS is not an answer for unqualified borrowers obtaining unsecured, risky loans.

[LuckyTheDog]

71. No. The postal service could...

... offer savings and checking accounts, as well as lending services.

The notion that the Postal Service would necessarily be incompetent at basic banking services is not something that the evidence shows.

[1939]

73. The postal service could do savings and checking accounts

as well as check cashing and selling money orders.

Making loans (and enforcing repayment) are probably well beyond their areas of interest (and competence).

Who is going to chase down the deadbeats (and there will be a lot of them)?

[JCMach1]

37. How many actual 'local' banks are left...

the ones that are there are probably giving good customer service and will be just fine!

[Adrahil]

48. Quite a few actually.

But the issue does concern me.

[melm00se]

32. how about credit unions

(the vast majority are depositor owned a truly progressive ideal) instead of a quasi-governmental agency?

[LuckyTheDog]

51. Credit unions are not filling the gaps

Credit unions are not clamoring for the business of poor people. If they did, we wouldn't have payday lenders and millions of people without bank accounts.

[PersonNumber503602]

78. What gaps are there exactly?

Are the banks/credit unions simply not operating in certain neighborhoods, or are they picky about who they offer checking accounts to? I know some people who cannot get checking accounts because they did something in the past that put them on chexsystems. However, at least one of the people was able to sign up for some sort of second chance account. There are also various online banks like ally bank that have legit free checking accounts. There is even simple.com which offers free checking accounts.

I'm not against the idea of the postal service offering basic checking accounts by any means. In fact think it's a great idea to have something that will always be there, and not be at risk of suddenly no longer being offered. I'm just asking about what's missing from these areas, because I do not know exactly what causes people to be unbanked.

[Rybak187]

33. I would be for the post office handling all the basic

Lifeline services

[Sam_Fields]

42. I've been banking at a Credit Union my entire adult life.

There is no reason for the Post Office to offer banking services. The unbanked don't have enough money to bank with most of the time or they don't want to bank because they are afraid or tired of overdraft fees. Besides there are now plenty of prepaid debit cards that offer a better alternative then banking because of no overdraft fees.

[Jesus Malverde]

81. What about check cashing and managing the electronic benefits on behalf of the country.

Something that is now managed by private corporations.

[KamaAina]

43. And they already sell money orders.

It's not like this would be a whole new thing for them.

[mac56]

45. The USPS offered this service well into the early 70s.

Many other countries still do.

The only reason someone would oppose this is if they want the USPS to fail and be privatized.

[JDPriestly]

46. The banks really don't want to bother with these small accounts.

They even charge monthly fees for small savers' accounts.

So I think this is a great idea.

[truedelphi]

53. They do not care about small savings accounts.

But the Big Banks love small time checking accounts. They net something like 48 billion bucks a year from issuing insufficient fund penalties to small time checking account holders.

When this household was struggling, we incurred some $ 1,500 in a year when we had
only $ 17,000 in income and medical bills to boot.

Wells Frgo even went and designed this "Savers' Helper" program where the small time checking account holder is encouraged to "do something" about savings. So each month, Wells Fargo will automatically put aside some $ 25 into a savings account.

If that bounces out the checks you just wrote, oh well. You should have paid attention.

Banks are also arresting people for the crime of forgery, even if no forgery happened!
If your signature looks some what like that of the person who wrote the check, that can be the end of your freedom.

I barely escaped having that happen to me, but one local man who did have it happen ended up in jail for three days. When he got out, the charges were dismissed but by then he had lost his job. But banks like Wells Fargo are investors in the prison industry so they probably consider that three days he spent in jail as money in their pocket!

[Jesus Malverde]

82. They don't want to within the bank, but they partner with payday loan companies..nt

[Stinky The Clown]

55. What an amazing thread. It is very easy to spot the thinking so typical of . . . . .

. . . . . the right wing, the racists, the classists, the big bank protectorate, etc.

[SickOfTheOnePct]

56. I haven't seen anything like that

I have see questions, including my own, that I think are valid.

[Jesus Malverde]

84. Japan post offers banking and insurance.

Insurance
September 2006 Established Kampo Co., Ltd. under the Postal Service Privatization Act
October 2007 Changed trade name to Japan Post Insurance Co., Ltd. in line with commencement of life insurance business
Started Postal Life Insurance management operations under commission from the Management Organization for Postal Savings and Postal Life Insurance
December 2007 Obtained approval for new operations (liberalization of investment products)
June 2008 Commenced commissioned sales of life insurance products for corporate clients (term insurance)
July 2008 Launched Sono hi kara, a new hospitalization rider
July 2009 Established branches in all prefectures through opening of the Nara Branch and Wakayama Branch
October 2011 JAPAN POST INSURANCE SYSTEM SOLUTIONS Co., Ltd. (current consolidated subsidiary) became a subsidiary
April 2014 Launched Hajime no Kampo, an educational endowment insurance
July 2014 Commenced handling commissioned sales of cancer insurance products for American Family Life Assurance Company of Columbus (Aflac)
September 2015 Obtained approval for commissioned sales of insurance products for corporate clients (general welfare group term insurance, etc.)
October 2015 Commenced sales of endowment insurance “New Free Plan (short-term premium payment)”
November 2015 Listed shares on the First Section of the Tokyo Stock Exchange
History of Postal Life Insurance

October 1916 Foundation of Postal Life Insurance business by the Ministry of Communications
October 1926 Foundation of postal annuity business by the Ministry of Communications
June 1949 Establishment of The Ministry of Posts and Telecommunications
January 2001 Creation of Postal Services Agency as part of realignment of government ministries
April 2003 Establishment of Japan Post

Banking



Japan Post Bank Co., Ltd., is a Japanese bank headquartered in Tokyo which is part of the Japan Post Holdings postal and financial services group. As of November 2008 it was reported as being the world's biggest deposit holder. Wikipedia

[riderinthestorm]

59. K&R! nt

[auntpurl]

63. We have that in the UK.

But I don't think many people use it.

[underahedgerow]

66. le Poste is a large bank in France. They offer many general and basic banking services.

I don't believe they offer debt related services though, such as credit cards and real estate / auto loans. Just banking and mobile phone services. Very affordable fees, widely available and very convenient.

Imagine banking without debt related services.

Credit cards aren't widely available in France, but they really encourage home ownership, even for those on a modest income, with lots of non-exploitative programs. Plus, just as an anecdote, most places only pay employees once a month. And the banks offer you a free overdraft, up to the amount of your paycheck. By law you must be paid by the 5th of the month.

Sometimes, regulation is a good thing.

[burrowowl]

75. Works well in France

[Jesus Malverde]

85. Postal banking system

https://en.m.wikipedia.org/wiki/Postal_savings_system