Postal Banking History

by Jeff Sovern

Various advocates have been calling recently for the Postal Service to get back into banking to seve the unbanked or underbanked. The financial industry has largely opposed postal banking, preumably because it doesn't want the competition.  One way to determine whether postal banking would be a mistake or a positive is to examine how well it worked when we had it in the US, as we did from the early twentieth century until 1966.  Mehrsa Baradaran of Georgia Law has written for Slate an interesting piece called A Short History of Postal Banking, presumably drawn from her forthcoming book on the subject. Here are the last two sentences:

Postal banking was America’s most successful experiment in financial inclusion—a problem we face again today. As we contemplate whether it has a place in our future we must recall the vital role it played in our past.

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