USPS defends postal banking pilot

July 18, 2022

The U.S. Postal Service defended its decision to launch an ICBA-opposed postal banking pilot program without first consulting the Postal Regulatory Commission.

USPS Defense: In a recent court filing to the commission, the Postal Service said the banking program it quietly rolled out last year to accept payroll and business checks as payment options for open-loop gift cards is not a departure from its existing greeting card, gift card, and stationery product lines.

Legal Questions: The PRC has asked the USPS why it didn’t seek the commission’s approval before launching the pilot last year, citing federal law requiring the USPS to get the commission’s approval for any “market test” for an experimental product. It has also asked how the USPS plans to proceed with the banking pilot given its lackluster performance.

Background: The USPS program offers check cashing, bill paying, ATM access, and expanded money orders and wire transfers at four locations. Customers may cash payroll or business checks to buy single-use gift cards worth up to $500 for a $5.95 fee.

ICBA Messages: ICBA has repeatedly pushed back against postal banking in a recent letter to Congress, LinkedIn op-ed, and three-part series of issue briefs to policymakers.