Postal Banking

There a persistent interest among certain lawmakers in allowing the United States Postal Service (USPS) to offer retail banking services.

It would be a serious mistake for the USPS to enter a highly competitive, complex new industry with the potential to ruin itself and its core function and put American taxpayers at further risk. Effective banking management requires years if not decades to master. Moreover, an agency that has failed to curb much less prevent growing mail theft (an ongoing source of check fraud which is costly for community banks and their customers) must not be entrusted with banking.

State Banks

In recent years, several states and localities around the country have considered proposals to create public banks to operate in competition with the thousands of existing private, for-profit, taxpaying banks that serve our communities.

Public banks create undue risk and exposure for taxpayers. Their deposits, if they choose to forgo or are not provided access to FDIC deposit insurance, would be backed by the full faith and credit of the state or municipality that chartered them, posing substantial risks to taxpayers, a risk heightened by lack of federal supervision. Further, such banks would be subject to political manipulation as favored groups would receive credit and other services on preferential terms. Credit should be allocated on an impartial basis to ensure sound lending and a competitive economy.