January 29, 2014

OIG suggests USPS offer cards, loans

Jan. 30, 2014 – The U.S. Postal Service's Office of Inspector General put out a white paper on Monday suggesting the agency offer financial services and products such as prepaid cards, remittances and small loans – pointing out that the agency could earn $9 billion by targeting underbanked customers.

In CU Journal, NAFCU Senior Vice President of Government Affairs and General Counsel Carrie Hunt responded that credit unions already offer "excellent savings mechanisms for their members," and she said credit unions are known for their strong ties to communities and dedication to serving the underbanked.

The USPS paper said, "The Postal Service could help financial institutions fill the gaps in their efforts to reach the underserved. While banks are closing branches all over the country, mostly in low-income areas like rural communities and inner cities, the physical postal network is ubiquitous. The Postal Service also is among the most trusted companies in America, and trust is a critical element for implementing financial services."

The Journal also quoted NCUA spokesman John Fairbanks saying the agency would look over the white paper. The USPS offered a saving system for consumers from 1911 until the 1960s, when it closed due to lack of demand.