Postal Banking Act
Bill: S.3891 | Sponsor: Sen. Gillibrand, Kirsten E. (D-NY)
Policy area: Government Operations and Politics

Summary:
Postal Banking Act
This bill grants the U.S. Postal Service (USPS) the power to provide basic financial services, including
It grants the USPS the power to set interest rates and fees for the financial instruments and products provided by the USPS that meet specified requirements.
The USPS (1) shall not be granted a bank charter or become an insured depository institution for the purpose of capital requirements, and (2) shall be subject to the provisions of the Uniform Commercial Code regarding bank deposits and collections.
The Federal Reserve Board of Governors shall transfer to the USPS such sums as necessary to carry out the services described in this bill, which shall (1) be sufficient to ensure that the products substantially decrease the number of people who do not have a bank account or use alternative financial products such as payday lending, check cashing, prepaid debt cards, and overdraft fees; and (2) be provided to the USPS through a separate account.
The Government Accountability Office shall submit to Congress an annual report that includes the demographics, number of participants, and average balances and uses for such products.

To amend title 39, United States Code, to provide that the United 
States Postal Service may provide certain basic financial services, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Postal Banking Act''.

SEC. 2. AUTHORITY FOR THE POSTAL SERVICE TO OFFER CERTAIN FINANCIAL 
              SERVICES.

    (a) In General.--Section 404(a) of title 39, United States Code, is 
amended--
            (1) in paragraph (7), by striking ``and'' at the end;
            (2) in paragraph (8), by striking the period at the end and 
        inserting a semicolon; and
            (3) by adding at the end the following:
            ``(9) to provide basic financial services, including--
                    ``(A) low-cost, small-dollar loans, not to exceed 
                $500 at a time, or $1,000 from 1 year of the issuance 
                of the initial loan, as adjusted annually by the 
                Postmaster General to reflect any change in the 
                Consumer Price Index for All Urban Consumers of the 
                Department of Labor;
                    ``(B) small-dollar lending servicing, which shall 
                ensure that the customer's access to the products and 
                the public interest is given significant consideration; 
                and
                    ``(C) small checking accounts and interest-bearing 
                savings accounts, not to exceed the greater of--
                            ``(i) $20,000 per account; and
                            ``(ii) 25 percent of the median account 
                        balance reported in the Federal Deposit 
                        Insurance Corporation's quarterly Consolidated 
                        Reports of Condition and Income;
                    ``(D) transactional services, including debit 
                cards, automated teller machines, online checking 
                accounts, check-cashing services, automatic bill-pay, 
                mobile banking, or other products or partnerships that 
                allow users to engage in the financial services 
                described in this paragraph;
                    ``(E) remittance services, including the receiving 
                and sending of money to domestic or foreign recipients; 
                and
                    ``(F) such other basic financial services as the 
                Postal Service determines appropriate in the public 
                interest;
            ``(10) to set interest rates and fees for the financial 
        instruments and products provided by the Postal Service that--
                    ``(A) ensures that the customer access to the 
                products and the public interest is given significant 
                consideration;
                    ``(B) ensures that interest rates on savings 
                accounts are at least 100 percent of the Federal 
                Deposit Insurance Corporation's weekly national rate on 
                nonjumbo savings accounts; and
                    ``(C) ensures that the total interest rates on 
                small-dollar loan amounts--
                            ``(i) are inclusive of interest, fees, 
                        charges, and ancillary products and services; 
                        and
                            ``(ii) do not exceed 101 percent of the 
                        Treasury 1 month constant maturity rate; and
            ``(11) to provide all financial products and services in 
        subsection (a) exclusively, ensuring that the customer's access 
        to the products and the public interest is given significant 
        consideration, and not through a partnership or contract with 
        private institutions, including insured depository 
        institutions.''.
    (b) No Bank Charter.--The United States Postal Service shall not be 
granted a bank charter, become an insured depository institution, as 
defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
1813), for the purpose of capital requirements.
    (c) UCC.--The United States Postal Service shall be subject to the 
provisions of article 4 of the Uniform Commercial Code.
    (d) Regulations.--The Postmaster General, in consultation with the 
Secretary of the Treasury, the Bureau of Consumer Financial Protection, 
and the Federal banking agencies, shall promulgate regulations carrying 
out this Act and the amendments made by this Act.
    (e) Technical and Conforming Amendment.--
            (1) In general.--Section 404(e)(2) of title 39, United 
        States Code, is amended by adding at the end the following: 
        ``The preceding sentence shall not apply to any financial 
        service offered by the Postal Service under subsection 
        (a)(9).''.
            (2) Federal reserve act.--Section 11 of the Federal Reserve 
        Act is amended--
                    (A) by redesignating the second subsection (s) 
                (relating to assessments, fees, and other charges for 
                certain companies) as subsection (t); and
                    (B) by adding at the end the following:
    ``(u) Funding for Postal Financial Services.--The Board, in 
consultation with the Chairman of the Board and the Postmaster General, 
shall transfer to the Postmaster General such sums as may be necessary 
to carry out the services described in section 404(a)(9) of title 39, 
United States Code, which shall--
            ``(1) be sufficient to ensure that the products described 
        in that section shall substantially decrease the number of 
        people who do not have a bank account or use alternative 
        financial products such as payday lending, check cashing, 
        prepaid debt cards, and overdraft fees; and
            ``(2) be provided to the Postmaster General through an 
        account separate from products not included or allowed under 
        section 404 of that title.''.
    (f) Rule of Construction.--The services offered by the United 
States Postal Service under section 404 of title 39, United States 
Code--
            (1) shall be considered permissible non-banking activities 
        in accordance with section 225.28 of title 12, Code of Federal 
        Regulations; and
            (2) shall not be considered the business of banking under 
        the seventh paragraph of section 5136 of the Revised Statutes 
        (12 U.S.C. 24).
    (g) GAO Report.--The Comptroller General of the United States shall 
submit to Congress an annual report that includes the demographics, 
number of participants, and average balances and uses for all products 
described in paragraphs (9) and (10) of section 404(a) of title 39, 
United States Code, as added by subsection (a) of this section.
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