WASHINGTON — JPMorgan Chase is reportedly in discussions with the U.S. Postal Service to test ATMs and other banking services at post offices in several states, according to a report from Capitol Forum.
According to one of Capitol Forum's sources, the deal involves JPMorgan Chase — the largest bank in the United States, with $3.2 trillion of assets — leasing space from the postal service. Capitol Forum also reported that the proposal could give JPMorgan the “exclusive right” to solicit postal customers.
A spokesperson for JPMorgan told American Banker that the bank has only had discussions with the U.S. Postal Service about leasing space and placing ATMs in post offices and that no agreement is in place.
“We had very preliminary conversations with the U.S. Postal Service several months ago (conversations began pre-COVID) about what it might look like to lease a small number of spaces to place ATMs to better serve some historically underserved communities,” the spokesperson said in an email. “These were very preliminary conversations — there is no agreement in place and no imminent plans to move forward.”
A representatives from the U.S. Postal Service could not be reached for comment.
The U.S. Postal Service has been under increased public scrutiny, with President Trump railing against the agency for its operating losses and Democrats pushing for additional funding for the agency as more states pursue vote-by-mail programs ahead of November's presidential election.
Mehrsa Baradaran, a professor at the University of California, Irvine School of Law, has long advovcated for postal banking, but she said that a plan with a big bank at the center of it may not be the best model.
“This is better than nothing — having JPMorgan team up with the USPS is better than the status quo — but when you look at what JPMorgan is doing, it may not provide the services that are the most essential for financial access everywhere, because they need to focus on the bottom line,” Baradaran said.
“JPMorgan Chase is a bank’s bank,” Baradaran said. “What I would envision for postal banking is having ATMs, debit accounts, low balance checking accounts — all things with higher overhead costs for banks. There would be thin margins, if any. … But if you’re JPMorgan, what’s the calculus here?”
Community banks have long opposed efforts by lawmakers to offer banking services at every post office in the country. But Paul Merski, group executive vice president for congressional relations and strategy at the Independent Community Bankers of America, said he would not necessarily oppose JPMorgan’s proposal, noting that the bank “places ATMs everywhere around the country.” JPMorgan Chase currently operates 5,000 branches in 38 states and Washington, D.C.
Merski said that the reported arrangement with the U.S. Postal Service would be an "odd partnering" and that he would be concerned with JPMorgan taking deposits in rural areas and deploying them elsewhere.
“The only concern I have is where you are not having a physical presence but you are basically collecting deposits from a local area, maybe a more rural area, and then moving those deposits out and using them in other parts of the country,” Merski said.
This story was updated to include comments from JPMorgan Chase.
