Imagine heading into Wegmans and pulling out your U.S. Postal Card to buy your groceries next week. It may not be long before you find yourself headed to your local Post Office for stamps - and a bank deposit too! The U.S. Postal Service Office of Inspector General recently published a report that makes a case for the Post Office to add financial services to its current mail delivering duties.
It's an interesting idea to be sure, and kudos to the USPS for thinking outside of the proverbial box - after all, they have to try and find some way to make up the $5 billion it lost in revenues to FedEx, UPS, and of course - e-mail. Aside from holding deposits, the report highlights bill payments, small loans, direct deposit, and mobile transactions as some of the services that could potentially be provided by the Post Office.
Estimates are that by capturing just 10% of the current $89 billion that it estimates our population spends on interest and fees paid each year, another $8.9 billion in revenues could potentially be generated, bringing the USPS back into the black for the first time in a long time. Whether this is a realistic goal remains to be seen. The report says the goal would not be for the USPS to compete with large, established banks, but to partner with them instead - to act as a complement as opposed to competition.
Interestingly enough, this would not be the first time the Post Office operated in financial services along with mail delivery - from 1911 to 1967 the Postal Savings System gave folks the opportunity to make savings deposits as designated branches, according to the report. The program was discountinued due to waning interest, but it appears that at least for now - there is something to be considered. This means, it may not be long before you find yourself heading to the Post Office to pay your bills, and this time, without the stamp.
Chuck Wade, Financial Advisor
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).