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The Postal Banking Act would authorize the United States Postal Service to offer basic financial services directly to the public, including small-dollar loans up to $500 (or $1,000 after one year), checking and savings accounts, check-cashing services, debit cards, and money transfer services. The legislation is designed to serve unbanked and underbanked Americans who currently lack access to traditional banking or rely on expensive alternative financial services like payday lenders and check-cashing businesses. The USPS would set its own interest rates and fees under specific guidelines, including requiring savings account rates at least equal to the national average and capping small-dollar loan rates at no more than 101 percent of Treasury rates. The bill specifies that the Federal Reserve Board would provide necessary funding to the Postmaster General through a separate account, and the Government Accountability Office would submit annual reports to Congress on program participation and usage. The USPS would operate these services independently without partnering with private banks and would not need a bank charter to offer them.

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