Gillibrand, Sanders Introduce Postal Banking Act To Provide Financial Services To Underbanked Americans
Releases Official Report Showing Postal Banking Could Generate Nearly $19 Billion Per Year
Today, U.S. Senator Kirsten Gillibrand (D-NY) and Senator Bernie Sanders (I-VT) reintroduced the Postal Banking Act, legislation that would re-establish postal banking to provide financial security to millions of Americans in low-income and rural communities. The Postal Banking Act would strengthen the Postal Service by establishing a nonprofit bank offering low-cost checking and savings accounts, ATMs, mobile banking, and low-interest loans.
At the same time, Gillibrand released an original report, “Postal Banking: Delivering For The American People,” demonstrating that:
- At least 1.5 million New York households and more than 25 million households nationwide stand to benefit from postal banking.
- Postal banking could generate nearly $19 billion in annual revenue for the United States Postal Service.
- More than 46 million adults are not having their needs met by our current banking system, with factors such as a lack of proximity to a local bank branch and a lack of trust of banks pushing the unbanked toward risky and often predatory alternative financial products.
“As our economy rebounds from the pandemic, it is essential that every American has access to financially safe and reliable banking services,” said Senator Gillibrand. “However, more than 46 million Americans are not having their needs met by our current banking system and often fall prey to predatory lenders who take advantage of them with high fees and interest rates. The Postal Banking Act is a simple solution to a complex problem—it would offer basic financial services at post offices in both rural and urban communities, while simultaneously generating nearly $19 billion per year for the USPS. Put simply: postal banking delivers.”
“It is absolutely unacceptable that nearly 50 million people in this country are unbanked or underbanked,” said Sen. Sanders. “What does that mean? That means millions of working people across this country are unable to access basic banking and financial services. That means that working people across this country are forced to face unnecessary barriers to important moments, such as buying a house, starting a business, or saving to send their children to college. That means that working people across this country are too often forced to rely on predatory lenders. This must change. The time has come to put exploitative loan sharks out of business, and guarantee affordable banking options to all Americans through the United States Postal Service. And that is exactly what our legislation will do.”
“All Americans deserve access to affordable banking and financial services. Postal Banking is a critical tool in providing access to the financial system to all Americans. We applaud all members of Congress who like Senator Gillibrand and Senator Sanders, are working together to find solutions to this problem,” said American Postal Workers Union President Mark Dimondstein.
The Postal Service employs more than 600,000 workers, including nearly 70,000 vets, and millions of Americans rely on it to deliver their paychecks, prescriptions, and votes. Unfortunately, Postmaster General Louis DeJoy has imposed destructive changes that have slowed mail and compromised services for veterans, small businesses, rural communities, seniors, and families who rely on the mail for medicines, essential goods, voting, correspondence, and income.
The Postal Banking Act would strengthen the Postal Service by establishing a nonprofit bank offering low-cost checking and savings accounts, ATMs, mobile banking, and low-interest loans. Using a method derived from the USPS Office of Inspector General, the report concludes that this proposal could create nearly $19 billion in revenue for the Postal Service each year. The postal bank would provide financial services to Americans who have been economically devastated by the coronavirus pandemic. Predatory financial services and practices such as prepaid debit cards, rent-to-own stores, and overdraft fees often exploit the most vulnerable populations – including low-income households, rural communities, veterans and families of active duty personnel – especially in times of economic crisis. Instead of turning to these predatory services, families would gain access to traditional basic banking services and safe financial alternatives through the postal bank.
The legislation has been endorsed by Alliance for Retired Americans, American Family Voices, Center for Popular Democracy, Color of Change, Family Farm Defenders, Farm Aid, Indivisible, Mainers for Accountable Leadership, MoveOn, NETWORK Lobby Catholics for Social Justice, Our Revolution, and Paragon Florida.
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