Doc of the day: Providing Non-Bank Financial Services for the Underserved, U.S. Postal Service Office of Inspector General, Report Number:RARC-WP-14-007 (January 27, 2014) [pdf. 33 pages].
Millions of Americans do not have a bank account, or use costly services like payday loans and check cashing exchanges just to make ends meet. The entire underserved population comprises more than a quarter of all U.S. households — some 68 million adults. They are an economically diverse mix of working and middle class families, poor and unemployed people hurt by the recent economic crisis, young people, immigrants, and others who are trying to make it paycheck to paycheck. Together, they represent a huge market. In 2012, they spent about $89 billion just on interest and fees for alternative financial services.
The Postal Service is well positioned to provide non-bank financial services to those whose needs are not being met by the traditional financial sector. It could accomplish this largely by partnering with banks, who also could lend expertise as the Postal Service structures new offerings. The Office of Inspector General is not suggesting that the Postal Service become a bank or openly compete with banks. To the contrary, we are suggesting that the Postal Service could greatly complement banks’ offerings.
Also see: The Post Office Should Just Become a Bank How Obama can save USPS and ding check-cashing joints, by David Dayen, New Republic (January 28, 2014).
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