OTTAWA, June 4, 2014 /CNW/ - A study of banks and payday lending
companies in the United States and Canada shows a real need for a
postal bank exists, especially in areas where post offices abound but
few banks offer their services. The paper, presented at the 22nd Rutgers University Conference on Postal and Delivery Economics, argues
that restoring postal banking in the 21st century would help support post offices while offering much-needed
financial services and jobs.
"Why force people to resort to payday lending and pawn shops when a
better option exists?" asked Denis Lemelin, National President of the
Canadian Union of Postal Workers. The union has been campaigning for a
Both the U.S. and Canada once had successful postal banks and they are a
fixture in other parts of the world such as Italy, France, Switzerland
and New Zealand. The federal government's recent agreement with
Canada's largest banks to create more low-cost bank accounts supports
the paper's finding that accessible and affordable banking services are
Canadians currently pay some of the highest banking fees in the world,
generating massive profits for the major banks, which reported profits
of $ 29.4 Billion last year.
However, those big bank branches can be hard to find in rural areas.
Between 1993 and 2003, Newfoundland and Labrador lost 23% of their bank
branches, creating what the paper calls a "banking desert." Now 235
communities have a post office but no bank.
In the Greater Toronto and Hamilton Area, payday lenders "shadow" the
banks, providing services such as loans and cheque cashing to
lower-income residents excluded from mainstream financial services but
at predatory rates.
Canada Post recently conducted its own study of postal banking, but
refuses to share it with the public. However, Canadians seem to like
the idea of postal banking, according to a poll from April 2014 where
64% supported Canada Post expanding revenue-generating services,
including bill payments, insurance and banking.
Image with caption: "Newfoundland and Labrador - Canada Post Locations (CNW Group/Canadian Union of Postal Workers)". Image available at: http://photos.newswire.ca/images/download/20140604_C8437_PHOTO_EN_41084.jpg
Image with caption: "Newfoundland and Labrador - Big 6 banks (CNW Group/Canadian Union of Postal Workers)". Image available at: http://photos.newswire.ca/images/download/20140604_C8437_PHOTO_EN_41085.jpg
SOURCE: Canadian Union of Postal Workers
For further information:
Aalya Ahmad or Kevin Matthews, CUPW Communications at 613-327-1177 or 613-293-5407 or visit www.savecanadapost.ca.