6 More Reasons Why The USPS Has No Business In Banking

This would be laughable if it weren’t so, well… pathetic. Here we are talking about the USPS getting into banking services (still!?) when they continue to struggle to do what they were created to do. If you recall, some months back we talked about the plan to test the USPS’s ability to offer a limited number of banking services. It was in our blog, “The USPS can barely deliver a check, let alone process one”

Well, sadly, nothing has changed since then. Just last week, in fact, I paid for priority delivery in order to get a small package delivered just a few states away. Has it shown up yet? Nope. Thank goodness I wasn’t shipping much-needed, life-saving medication! (Not that I would since, I believe, that’s pretty illegal, anyway). But, so much for two-day delivery. It’s no doubt sitting in some warehouse somewhere.

Speaking of delivery, how has the USPS done with this banking services program? Well, the USPS launched its limited “toe dip” into banking last September with a pilot program at four post offices. For a flat fee of $5.95, customers could purchase a single-use VISA® gift card of up to $500 using business or payroll checks as payment. USPS won’t accept checks larger than $500 and won’t disburse cash for any checks. The four post office locations that are currently participating in the pilot are in Washington; Baltimore; Falls Church, Virginia and the Bronx, New York.

Since the launch of the program, the USPS has provided financial services to… can you take a guess here?  5,000 individuals? 15,000? Try 6. That’s right. Not 600, or 6,000. Six. I had to laugh when I read on govexec.com that the result is “bringing into question whether one of the government’s largest agencies will expand the effort that many progressive lawmakers and advocates have pushed for years. The six sales using checks between September 13 and January 12 have brought in just $35.70 in fees for a total value of $548.46 in gift cards.” Why the laugh? “Bringing into question”?  What’s the question this result is bringing? Is it a success? Should we keep trying? To me, the only and most obvious question is: Why aren’t we putting a stop to this right now?? According to Government Executive, “postal management declined to say what its plans are with the pilot moving forward, explaining any decisions are pending further evaluation of the results of the initial program.” Call me crazy, but how much evaluation is needed to determine whether or not this is working? I think that $37.50 in fees over nearly six months pretty much speaks for itself. 

As always, there’s significant political controversy around this. The top Republicans on two key committees—Reps. James Comer, Ky., and Patrick McHenry, N.C., the ranking members of the Oversight and Reform and Financial Services committees, respectively—said in a recent letter to Postmaster General Louis DeJoy that the pilot program was hidden from them and rolled out “in secret.” They noted that they “strongly object to the concept of postal banking” and questioned whether DeJoy had the authority to launch the program unilaterally. The pilot's “quiet launch” they said, has now led the lawmakers to question whether the postmaster general worked with them in good faith.” 

Personally, I don’t think that Comer and McHenry have much to worry about. In fact, instead of getting angry with DeJoy — if they truly want the USPS to stay out of the banking services game — they should be thanking him! What better proof that this is a bad idea than less than $36 in sales over nearly six months. I did better than that with my lemonade stand as a kid!?

As always, I would love to hear your thoughts.

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