Banks Throw Hissy Fit After Elizabeth Warren Endorses Idea to Allow Post Office to Offer Financial S

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http://www.alternet.org/economy/banks-throw-hissy-fit-after-elizabeth-warren-endorses-idea-allow-post-office-offer-financial


Banks Throw Hissy Fit After Elizabeth Warren Endorses Idea to Allow Post Office to Offer Financial Services



***SNIP

Let’s take a look.

If the plan went through, in addition to selling stamps and processing mail, the post office would offer prepaid cards — one that would allow users to pay bills online, and withdraw money at ATMs. The post office would also develop services to let customers save and borrow money.

It’s not like the banks would be on the outside looking in. There is a continuing role for them in the inspector general’s plan. Not only could they handle the back office support for these new financial products and services, they could even buy the loans from the post office.

What could the financial services world possibly object to in this? Well, as I say to my children: Just because someone says something, doesn’t mean it’s true.

Turns out banks are not actually losing money on low-income Americans. In fact, the less than wealthy have turned into a nice little profit center for the big banks. If these customers want to stay, the banks make them pay.

[Laelth]

1. k&r for Elizabeth Warren. n/t

-Laelth

[Ilsa]

2. Prepaid cards are a big moneymaker.

They are used by people without credit, the working poor, and there is plenty of that business to go around.

[customerserviceguy]

8. Aren't most prepaid cards

bought at grocery and convenience stores? Both places have longer hours than the Post Office. Perhaps in some rural communities, this would be a boon, but I don't see where getting to the few remaining Post Offices with their limited hours is attractive to people who might have low-paid jobs where they have to spend all of the business day getting to and from them on public transportation, and then at those jobs.

Still, it might work in some places, and unless it's a money-loser for the USPS, it's better to have the option.

[Ilsa]

11. A lot of people work shifts, or sporadic

jobs. And to jumpstart it, they could charge lower fees.

It may not work everywhere.

[customerserviceguy]

44. Low fees would be something useful

But most post office lines are longer than convenience store lines, in my experience. And convenience stores are open nearly around the clock in many places. I wouldn't look for this to take off, in my business we see more money orders from 7-11 than we see from the USPS.

[Ilsa]

54. The longest lines I've been in were in convenience

stores, where ID was required for beer and cigarettes. The lines also include lottery ticket purchasers.

My PO lines are there, but move fast. I'm in and out in less than ten minutes, which is about the same at 7-11/Stripes/etc. It just depends. And it might be possible to automate the card process.

[customerserviceguy]

65. Automating the card process

would be essential. I wonder if some sort of vending machine for this exists today that could be appropriately modified for prepaid card purchases.

[Hestia]

50. Used to live in a semi-rural city and you would not believe the lines of people there buying

money orders to pay their bills. Wholly shocked when I first moved there - seems it was due to past checking account problems and now they were stuck paying their credit card, utilities, etc. via money orders. I learned to go at 10 a.m. - anytime after that, the lines were out the door until closing.

Money orders are how it will be legal for the USPS to add on other financial services without creating a new charter. The law is already on the books, it just needs to be reactivated.

While they are there, why not buy a prepaid card too, like at the grocery store? Let's just hope the fees are way less than the grocery store - $4.95 for $50 Visa Card - don't tell me that ain't usurious.

Lower the card rate to the same as MO (what are they now, $1.95? $2.95?) and the USPS will be swimming in dough, though I've read they have a deal with AMEX to sell their cards but they have a huge fee on their prepaids; dunno what the fee is with USPS.

[customerserviceguy]

62. Yes, I'm familiar with the unbanked using money orders

My company serves a semi-rural area downstate in NJ, a lot of our customers there tell me that they're going to mail in or drop off a money order. I try to suggest credit unions to them when it seems they will be receptive.

This Great Recession just hasn't been great to a lot of people.

[DJ13]

53. Who's to say the USPS cards wouldnt also be available at grocery stores?

Lower fees would be the main selling point.

[customerserviceguy]

63. Lower fees

mean lower fees to retailers, I can't imagine them shunning the cards they already carry in favor of ones that would pay them less for the shelf space. However, a few retailers have contract USPS operations inside their walls, I can imagine that folks who have time to wait in the postal lines would go for a cheaper USPS-issued prepaid card, while the higher priced ones would still be available for those who either didn't have time to wait, or wanted one after postal window hours.

It wouldn't be a terrible idea to sell them out of vending machines, or something ATM-secure that would take in cash and dispense cards, but I don't know if the latter idea has been developed yet, and I question how secure (for the USPS, that is) that the former idea would be with a conventional vending machine.

[aggiesal]

58. The idea . . .

as I understand it, is to get rid of those paycheck loan places.
The post office would offer basic financial services to those that don't have bank accounts,
or don't want one.

[customerserviceguy]

64. If it works

it would be a good idea. I've never gone to the paycheck loan places, but I would imagine that the transactions take a bit longer than the average postal consumer takes today. Of course, you have the mass mailer who sends out a bunch of things they're selling on eBay, and I could see where this could make lines even longer and more frustrating.

I suppose that most post offices have more windows than personnel to staff them, and this might be a way to retain the jobs of some who could serve at those windows, keeping lines down. However, most post offices I've been to don't have a lot of parking spaces, and this concept would be of the most use where foot traffic is the primary source of USPS business.

[aggiesal]

66. I lived in Europe for over 2 years . . .

The post offices there handle additional services like
banking, bill payment, packages along with normal post.

They should be able to handle those services here as well.

[Arcanetrance]

3. If I remember correctly there were some banks with their hands in the payday loan business

They'd be pretty upset to lose the ability to leach off the poor with ridiculous interest and terms.

[Sgent]

24. A few

may have directly owned some.

Most banks though don't "own" the business, but they do lend money and provide transactional banking for those places.

[Demo_Chris]

4. Where's the rest of our party on this?

[nikto]

27. Cashing their corporate check$

Where else would they be?

[Demo_Chris]

30. This is exqctly the kind of thing I want to see them pushing...

...rather than free trade deals, more fracking, and chained CPI.

[MannyGoldstein]

5. "Now Jamie... Lloyd..."

Last edited Wed Feb 12, 2014, 11:57 PM - Edit history (1)

"Again... I'm not totally to blame... It's you guys that wanted her out of... No, Jamie, I won't do that to myself, I can ask the Surgeon General but my gut is it's anatomically impossible, anyway... And didn't Holder figure out how to get you that raise?... Lloyd, vivisection is illegal on anyone, particularly a US senator..."

[Demeter]

6. At least he's not talking to the Drone sites

I hope.

You won the cynicism contest hands down, Manny. Congrats!

[MannyGoldstein]

7. Do you know what totally sucks?

Since 1980, no matter how cynical I am... the reality is even worse.

[Demeter]

22. With you on that.

And the lip service is so repulsive...not even remotely connected to reality.

[Nay]

17. OK -- that's funny as hell, Manny. I laughed out loud.

[DeSwiss]

9. Well now she has herself a cudgel.....

...please use it liberally.

- K&R

[center]
[/center]

[florida08]

10. I Love Her

Time to hit the phones

[Scuba]

12. Thank you Elizabeth, for standing tall and proud for the American People.

[Progressive dog]

13. Elizabeth Warren wants the USPS to partner with banks

Senator Elizabeth Warren (D-Ma.) argues in a recent editorial. ”USPS could partner with banks to make a critical difference for millions of Americans who don’t have basic banking services because there are almost no banks or bank branches in their neighborhoods.”

She is endorsing the report from the Postal Service.
[link:http://business.time.com/2014/02/07/this-plan-could-save-the-post-office-from-extinction/
[link:http://business.time.com/2014/02/07/this-plan-could-save-the-post-office-from-extinction/|

[DFW]

14. In Germany, the Post Office has long offered banking services to anyone who wanted them.

I don't know how it is in other countries, and I have never availed myself of the financial services of "die Post." But for people who only need the simplest of financial services, and are looking for competitive service charges, I'm sure the Post here offers some kind of decent banking services, or else they would have abandoned them long ago when they were privatized. As it is, they seem to do regular business with quite a few customers.

[homegirl]

55. "die Post"

Same in Sweden. And all government disbursements to private citizens are paid with and through post office accounts. Has worked for decades.

[KurtNYC]

15. The cards would seem a natural extension from the money orders

which are now somewhat archaic.

With this and if they pass something to un-do the 75 years of retirement funding debacle the post Office could be revived.

[Nay]

16. "Banks throw hissy fit" -- that's how we can be sure it's a great idea. nt

[Enthusiast]

19. +1 a shit load!

[reusrename]

34. and another shitload!

[Dark n Stormy Knight]

35. Ain't it the truth!

[daleanime]

18. Kick....

[Egalitarian Thug]

20. Even those that can't quite get their heads around how hard it is to be poor can at least

understand that if the TBTFs don't like it, it must be good for the rest of us.

[Swede Atlanta]

21. Many European postal services have offered bank-like services for years.

In Sweden you had an account known as a GIRO. It was a depositor's account where you could deposit money and then directly pay creditors by transferring money from your GIRO account to the creditor's account. As well you could get cash and/or the equivalent of a cashier's check.

I see this as a technological extension of the post office's historical role is issuing money orders.

But we know that the Rethgulicans want the Post Office to fail so they can sell it off to the highest bidder and then have the private sector "rationalize" the delivery of mail and packages. We would see prices skyrocket and those people in small rural communities? Good bye postal delivery.

I grew up in Wyoming in a small town of about 8K people. A privatized postal service would likely continue to serve that community because there are enough "customers" to warrant the service. But as for the people that live on farms and ranches outside of town (some as many as 50 miles away), I doubt a privatized service would support them. Those people would likely have to drive to the nearest "post office" to collect their mail or pay some kind of subscription or premium to have home/business delivery.

[think]

23. Pragmatic solutions for real problems facing America

Cool....

[Lodestar]

25. Aw...but but private companies were already counting the $$$ they'd make from USP's demise.

They've been working really hard to drown it in the bathtub of privatization.

[marmar]

26. The Titans of the "Free Market" hate competition.

[El Shaman]

45. You can't beat the capitalist-

free market model:
http://www.geekwire.com/2014/proposed-law-block-new-tesla-stores-washington-state/

[fadedrose]

28. I emailed the WH 3-4 weeks ago

and asked them to share the email with Warren, th Postmaster General, Yellen, Treasury, about saving the post office and selling US PAPER bonds there, and keep the banks away from the whole deal.

Sounds like Warren got her copy. ..."develop services to let customers save..."

I sent more mail on these things than anyone. Last year I even offered George Clooney's free services advertising the sale of US PAPER bonds. Generous of me I think...also some female star, forget who...

I see a day where I give one of the kids $25 and they say "take me to the post office so I could buy a bond."

[wercal]

29. Occassionally I tell my tale of a Post Office Money Order

Somebody once repaid a debt to me with a PO money order. Probably around $300.

I took it to my bank - they wouldn't cash it. Ok, understandable...I'll just deposit it. Nope. I even suggested depositing it, but waiting 10 days before the funds were available. No dice - and this wasn't my bank being difficult. It turns out that postal money orders are so commonly counterfeited, that banks treat them like kryptonite.

Ok, so I do the obvious, and take it to a post office. I was not treated well. Eyes rolled, and I was told that they hardly ever had that much money in their drawer. So, I embarked on my magical postal tour, and over a period of 3 days, I drove all over town, bouncing between 3 post offices (they weren't real keen on my calling them to see if a drawer was full). Eventually, I hit pay-dirt, and a drawer had enough money to cover my money order.

Lets just say I am skeptical about the USPS entering the banking world. They could lease space for ATM's I suppose. They could sell the exact same pre-paid cards that the gas stations sell, purely as a vendor that gets a small percentage. But actually provide banking services...I have my doubts.

[questionseverything]

43. love warren but i have had similiar problems

cashing postal money orders...now all the postal workers are nice about it but I really never know when I walk in if they will be able to cash it or not

[grahamhgreen]

31. PO would also offer mobile broadband & encrypted email:)

[jwirr]

32. The banks charge an arm and leg for almost all of their services. Competition is what they need.

[musselmanm]

41. You!

You could start delivering mail to compete with them.

[freshwest]

60. Yes, the banks need more competition to make them more responsive to consumers. n/t

[Sunlei]

33. a couple people,I would like to pay by check but Chase takes $6.00 from their $25.00 ck!

I have read these main banks get 2% off the top!!, of every single debit card use across America. Imagine that income alone.

I give a lot of credit to the Occupy Movement , because of them the debit card use fee charge still isn't used by my bank. But they charge a fee for everything!!

All their other fees and charges keep a lot of regular Americans unable to afford a basic checking and savings account. Banks out of reach also force people to carry cash!! this increases crime!

I'm all for a Gov run checking and savings bank. pay a decent interest earning on CD and savings...more than 1%!! This will make these for profit banks CHANGE to attract regular accounts again.

[Sgent]

36. Not nearly that high

For debit cards as a guideline merchants pay 2% for online, 1.6% swiped and a flat fee of 15-30 cents for pin based transactions.

[RB TexLa]

48. And those merchants don't have to accept credit/debit cards.

I've told them, if people don't think highly enough of you to get cash to pay you for your gasoline then you should shut up about the fees cause without the ability to take cards it sounds like you would have a business.

[tclambert]

37. They are all for a Free Market, as long as you mean free from competition.

Banks hate non-profit Credit Unions, too.

[Rex]

38. Fuck the banksters.

They have more than enough money, fuck em.

[NorthCarolina]

39. Would love to refer to her a President Warren. nt

[Fearless]

42. +10000!

[catrose]

40. they would be madder

if her proposal worked with credit unions like I want. There are postal credit unions that could step up.

[whistler162]

46. Everything thing old is new again.....

From the Taft administration to the early 1960's this was real. So she is a good old fashioned Republican.

[yourout]

47. This would scare the living hell out of the financial sector. How could they justify their......

raping of American if people could actually get something decent at a decent price while the Government actually made money?

[Incitatus]

49. Go Warren! And whatever you do, stay out of small aircrafts. nt

[GP6971]

51. And this surprises who???? n/t

[MrModerate]

52. They do this now in Australia . . .

And it's helped keep Australia Post (the equivalent of USPS) relevant in the marketplace. It's a darn good idea.

[Drahthaardogs]

56. works great for italy

Why not here

[JDPriestly]

57. The banks are charging people fees for saving small amounts of money in their savings

accounts. Children don't have to pay the fees, but adults do. That is absurd.

We really need some competition from the Post Office to give people who do not have much money the opportunity to save and bank without having to pay the exorbitant monthly fees of some of the banks.

[ReRe]

59. Look it...

... if there's a financial transaction around, Wall Street wants in on it. If there's any money to be had anywhere, they think they have Divine right to it. What this hissy fit tells me is that the USPS deal is a probably a good thing. And if Sen Warren likes it, then it really IS a good thing. Now if we can get a Democratic majority in the House and a filibuster-proof majority in the Senate next January, it will have a chance of becoming available to all who have a mind or need to use the PO prepaid cards. We have our work cut out for us, but never say it can't be done.
We reelected PO in spite of Citizen's United, didn't we? We can do this.

[wildbilln864]

61. Thank you again Elizabeth Warren & k and r!