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If you think allowing post offices to morph into neighborhood banking centers is at best a utopian fantasy, or a just plain crazy idea, the Postal Service Inspector General wants you to think again.

The inspector general's office released a report today concluding that expanding the financial services post offices already provide could lessen or even close the post office's annual deficit, making reductions in mail service unnecessary, while providing essential services to the estimated 68 million Americans who don't have a bank account or have to use expensive check-cashing and payday lending outfits.

"For millions of underserved families, the Postal Service is already a part of their financial lives," the report said, noting that post offices sold $21 billion worth of money orders in 2014. Yet, "in order to get the funds to purchase those money orders, many families likely first went to expensive check cashers to convert their paychecks into currency. What if those consumers could instead cash their paychecks at a post office for a lower fee? What if they also could pay bills, buy low-fee prepaid cards, and maybe even get affordable small-dollar loans, all in one convenient location? This could help consumers save money and time, and it would help the Postal Service fulfill its mission to facilitate commerce and serve citizens."

The IG report concludes that "most current users of alternative financial services would go to their local post office to ger more affordable financial products."

Depending on the suite of services the Postal Service provides, it could earn anywhere from an additional $1 billion in revenue to $10 billion. That higher figure is based on a scenario in which the Postal Service receives the same percentage of its revenue from postal banking as do post offices on average in other industrialized countries.

The report follows up on one the Inspector General's office issued last year that affirmed that people in communities underserved by traditional banks would benefit significantly by expanded Postal Service financial services. The latest report contains a man u of options for how to do that, weighing the merits and potential hurdles of each.

The Postal Service is struggling under a crisis created by conservatives in Congress, which in 2006 required it to set aside $5.5 billion each year to over pansion costs for up to 75 years into the future – a requirement that no other entity, public or private, has to comply with.

Without that funding requirement, the Postal Service in 2014 would have broken even, and there would not be the pressure on the Postal Service to close distribution centers – which has had the effect of slowing down delivery of some first-class mail – and consider ending Saturday mail delivery.

“It’s a no-brainer,” said Mark Dimondstein, president of the American Postal Workers Union, one of the organizations that helped form the Campaign for Postal Banking. “The Inspector General report confirms that the Postal Service can act now to provide consumers with affordable financial services while strengthening our trusted national treasure, the public Postal Service.”

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