Sens. Kirsten Gillibrand, D-N.Y., and Bernie Sanders, I-Vt., are two of the sponsors of the new postal banking bill.

Sens. Kirsten Gillibrand, D-N.Y., and Bernie Sanders, I-Vt., are two of the sponsors of the new postal banking bill. Tom Williams/CQ Roll Call via Getty Images

Postal Banking Isn’t Done Yet, Even Though It Was Stripped from the Recent Spending Package

Democrats have introduced a new postal banking bill and advocates are still hopeful USPS will expand a small pilot program it launched last year.

Senate Democrats are renewing their call for more banking services at the U.S. Postal Service, looking to push the mailing agency further after it began a pilot program last year. 

Sens. Kirsten Gillibrand, D-N.Y., Bernie Sanders, I-Vt., and Jeff Merkley, D-Ore., introduced a postal banking bill (S. 3891) on Tuesday after congressional negotiators kicked language demanding additional financial services at USPS off the fiscal 2022 omnibus funding package President Biden signed into law last week. The new measure would allow the Postal Service to offer low-cost checking and savings accounts, ATMs, mobile banking and low-interest loans. 

House Democrats had included in their original fiscal 2022 funding bill $6 million for USPS to pilot “non-banking financial services” in at least five rural and five non-rural ZIP codes, including surcharge-free ATMs, wire transfers, check cashing and bill payment “to the fullest extent permitted under current statutory authority.” The Postal Service is already involved in financial services by offering money orders, the lawmakers noted. 

Ultimately, after negotiations with the Senate, where bipartisan support was required to clear a 60-vote threshold, the language was removed from the measure. Gillibrand and Sanders, along with various House members, such as Rep. Alexandria Ocasio-Cortez, D-N.Y., had also pushed for inclusion of the provision in the funding bill. 

“What we are asking the Post Office to do here is very basic but it’ll make a dramatic difference in so many communities and so many families,” Ocasio-Cortez said last year. “It’ll also provide needed revenue to USPS.” 

Progressive lawmakers have for years pushed USPS to offer more banking services, but postal management has largely demurred. Instead, the agency has said it should shore up its finances by focusing on its core offerings. Last year, however, Postmaster General Louis DeJoy worked with the American Postal Workers Union to launch a small-scale pilot authorizing a few post offices to offer limited check cashing services. In the first four months of that program, however, the post offices provided cashed checks—in the form of Visa gift cards—for just six customers, which brought in $35.70 to USPS.   

Postal management has said it will measure the success of the initiative based on customer usage and whether there was a demonstrated benefit to the community. USPS has not gone to great efforts to market the availability of its financial services. Before the program gained attention in national media outlets, USPS only announced the availability of the check cashing service through signs in the four affected post offices.

When USPS launched the initiative, American Postal Workers Union officials, who worked closely with postal management in setting it up, said the initial sites and services were meant to be a “proof-of-concept” test for the Postal Service. The union was hopeful that USPS would expand the pilot in early 2022, both in terms of services offered and locations where they are available. The easiest areas for expansion would be to allow for gift cards for checks of more than $500.

At the time it launched the pilot, postal management was looking to both raise the cap on the cards and allow for the bundling of multiple of them. Other services in discussion were a bill pay product, making the cards branded to the Postal Service and reloadable, and wire transfers from one post office to another. USPS has expressed an openness to setting up its own ATMs, though that may require additional statutory authority and was therefore only expected much further down the road. USPS offered banking services for more than 50 years, but stopped in 1967.

Research from the University of Michigan has found that one-in-four U.S. Census tracts, which are home to 21 million people, do not have any banks within their borders. Advocates for postal banking have highlighted that the private sector often charges high fees for check cashing and other services, and that historically disadvantaged communities are disproportionately impacted by them. The Postal Service is charging $5.95 per check transaction and, for now, is only allowing the checks to be used for gift cards.

While the new legislation would go much further, it remains unclear how much appetite Congress has for more floor time on another bill to overhaul the Postal Service. Lawmakers just passed the first major postal reform bill in 15 years, which enabled USPS to work with state and local governments to expand some offerings, but did not broaden its financial services authorization. Republican lawmakers have decried even USPS’ diminutive pilot program, saying they “strongly object to the concept of postal banking.” The limited services at four East Coast post offices fall far short of the much more comprehensive suite of financial services many advocates and left-leaning lawmakers have sought for years, but still took USPS in a surprising direction under Postmaster General Louis DeJoy’s rocky tenure.

The Postal Service declined to comment on the bill, or whether it was still considering expanding its financial services.

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.