CUNA joined financial trade associations representing institutions in every state Thursday to urge House leadership to reject the inclusion of a postal banking provision in the Financial Services and General Government (FSGG) Appropriations Act for FY2021. An amendment offered by Reps. Bill Pascrell (D-N.J.) and Marcy Kaptur (D-Ohio) would provide $2 million to the U.S. Postal Service for postal banking pilot programs throughout the United States.
“Although we appreciate—and strongly support—efforts to increase financial inclusion across the country, we are deeply concerned that allowing the U.S. Postal Service to provide banking services will be beyond the Postal Service’s core competencies, will raise a number of serious regulatory and consumer protection questions, and could leave consumers less protected than they would be at a regulated financial institution,” the letter reads.
The letter notes the U.S. Treasury and U.S. Postal Service’s own reports that acknowledge the USPS’s “narrow expertise and capital limitations” mean it should not expand its offerings into areas “where balance sheet risk might arise.”
The organizations also note their support for postal reform to reduce costs and increase efficiencies, but note postal banking is “not an acceptable solution.”