This aligns with what we had put forth to provide different avenues for banking sector, while reducing the too big...

This aligns with what we had put forth to provide different avenues for banking sector, while reducing the too big to fail risks.

By the way, Is postal banking a new concept?
There are still countries out there with reasonable postal banking system in place.

When it comes to US, post 1907, and post great depression crises, postal banking thrived until 1966 when community banks took over, while postal banking was abolished.

Is it the right one for current times?
It certainly increases the competitive landscape providing opportunities to alleviate risk profile in the banking sector, while increasing career opportunities for citizens and permanent residents. It will also offer a reliable banking option for low income families, if managed properly.

What is the challenge?
Considering that the postal service is debt-struck, and had been poorly managed in the recent years, it makes us wonder how the banking wing of US postal service would manage the deposits of families.

Originally shared by Eli Fennell

U.S. Post Offices Could Soon Become Banks

If a forthcoming bill passes in the U.S. Congress, Post Office locations could soon offer basic banking services for low income Americans, including fee free accounts for depositing up to $20K or the Median American Bank Account Value (whichever is higher), and small, short-term loans at interest rates just above Treasury Loans to compete with predatory high interest payday loans.

If they can capture only 10% of the latter market, it would be worth nearly $10bn annual revenue, while saving loan recipients billions in interest fees. In other words, they'd be competing for a market with a total value of somewhere around $100bn annually.

This would make basic affordable banking services available at locations in nearly every community in the nation, and may even lead to the opening of new postal locations instead of the slow cycle of closures.

The bill, put forth by N.Y. Senator Kirsten Gillibrand, has been compared to a 'Public Option for Banking'. It is not clear if it has the support needed to pass, or will even garner the support of Donald Trump, despite his frequent grumblings about the plight of the USPS. Sadly, this may well be too good an idea to ever pass.

#NewsFlash #PostalBanking