USPS testing paycheck cashing, which could transform how millions access money and pay bills

The Washington Post via Yahoo Finance ^ | October 4, 2021 | Jacob Bogage

[fluorescence]

WASHINGTON - The U.S. Postal Service quietly began offering paycheck-cashing services at several East Coast post offices last month, testing a plan that financial experts say has the potential to transform how low-wage and underserved Americans access their money.

Postal customers can now redeem paychecks in Washington, Baltimore, Falls Church, Va., and the Bronx, N.Y., for Visa gift cards topping out at $500, an agency spokesperson said. Postal officials expect to expand the pilot into a fuller study with more locations and financial products, such as bill-paying services and ATMs, according to three people involved with the program who spoke on the condition of anonymity to discuss sensitive business strategy.

Postal banking has become a Democratic hobby horse in recent years, with activists and politicians saying it solves two problems: the Postal Service's precarious financial condition and the barriers many U.S. households face to building wealth and accessing their money.

For the nation's 14.1 million unbanked and underbanked adults, the plan presents a government-backed alternative to paycheck cashing stores and payday lenders, which target vulnerable populations with outsized fees and interest rates. Democrats embraced the idea years ago: Sen. Bernie Sanders, I-Vt., made postal banking part of his 2016 and 2020 presidential platforms, and it was adopted by the Biden-Sanders Unity Task Force as part of President Biden's 2020 campaign agenda.

...

Union officials said they expect the program to reach other post offices nationwide after the holiday season. The Postal Service will soon begin advertising the paycheck cashing service, and will use the increased foot traffic during the agency's peak season to gauge consumer interest and effective price points.

[Ikeon]

The post office can't walk and chew bubblegum, now they want to add a stack of gift cards to the mix? What could go wrong?? 🤡.

the next headline will be the USPS reports they lost over 160 million US Dollars in 2022 and are investigating.

[VanShuyten]

“… the Postal Service’s precarious financial condition…”

What’s the USPS cut for check cashing? It had better be pretty high if it’s going to positively affect their “precarious financial condition “.

Or is it a free service?

[Vaduz]

So they want to take over credit card services??.

[minnesota_bound]

FTA: .... with outsized fees and interest rates.

I hope they go into the credit card business!
20% - 30% interest when the banks get nearly free interest money and give barely any for your accounts.

[damper99]

Trading a paper check for a plastic card. They won’t have cash on hand do do otherwise. The last time I tried to “cash” a USPS money order at the post office they were unable to since the clerk’s money drawer was limited to $100 and the money order was for several hundred.