WASHINGTON–Despite the great concerns raised by many traditional financial institutions, including credit unions, over plans by the U.S. Postal Service to provide financial services, just a half-dozen people have used the services since the USPS pilot was launched in September 2021.
According to Govexec.com, the hugely underwhelming response brings “into question whether the mailing agency will expand the effort that many progressive lawmakers and advocates have pushed for years.”
As CUToday.info reported, the USPS launched its limited foray into banking in the fall of 2021 at four post offices and with little fanfare. It allowed customers at those locations to use “business checks”—that is, checks with a business’ name printed on the check and made out to the individual—to pay for Visa gift cards of up to $500.
35 Bucks in Fees
Govexec.com reported the six sales using checks between Sept. 13 and Jan. 12 have brought in just $35.70 in fees to the Postal Service, the agency said in a filing with its regulator, and provided a total value of $548.46 in gift cards.
“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,” Govexec.com reported. “USPS said it will measure the success of the initiative based on customer usage and whether there was a demonstrated benefit to the community.”
The Postal Service is charging $5.95 per check transaction and, for now, is only allowing the checks to be used for gift cards.
“USPS has not gone to great efforts to market the availability of its financial services,” according to the report. “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.
Falling ‘Far Short’
“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 report continued.
Both CUNA and NAFCU have voiced strong opposition to the Postal Service getting back into the banking business, which it exited in the late 1960s.
“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,” Govexec.com stated. “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. Thousands of post offices already offer Visa gift cards, and management concluded there would be few legal hurdles to simply accepting another form of payment for them. The cards USPS currently has in stock are capped at $500, hence the existing maximum.”