Senator Bernie Sanders (I-Vt.) and Congresswoman Alexandria Ocasio-Cortez (D-N.Y.) will introduce a joint bill on Thursday to reduce Americans’ debt. Dubbed the Loan Shark Prevention Act, the legislation looks to cap the interest rate at 15 percent for credit card debt, while enforcing penalties for lenders who violate the limit with hidden fees.
A spokesperson for Ocasio-Cortez’s office also told The Intercept that the freshman representative plans to suggest postal banking as a public option for consumer lending—meaning the U.S. Postal Service could get into the business of operating checking and savings accounts. Turning post offices into banks is by no means a novel concept: Currently, only seven percent of the world’s post offices don’t offer basic financial services.
During the 2016 election, Sanders incorporated postal banking as a minor policy point in his presidential campaign.
“If you are a low-income person, it is, depending upon where you live, very difficult to find normal banking,” the senator said during an interview. “Banks don’t want you. And what people are forced to do is go to payday lenders who charge outrageously high interest rates. You go to check-cashing places, which rip you off. And, yes, I think that the postal service, in fact, can play an important role in providing modest types of banking service to folks who need it.
Last summer, Senator Kirsten Gillibrand (D-N.Y.), another 2020 candidate, introduced a bill that would authorize post offices to offer financial services, including the ability to grant short-term loans.