The Research Brief is a short take about interesting academic work.
The big idea
About a quarter of census tracts with a post office don’t have a community bank or credit union branch, suggesting postal banking could provide a financial lifeline to the millions of Americans without a bank account, according to our new research
To reach this conclusion, we analyzed nationwide data on post office retail locations and bank and credit union branches, as well as other demographic details in those areas. We wanted to understand how prevalent U.S. Postal Service locations are in areas underserved by banks and credit unions.
Our research examined data from U.S. census tracts, which are districts created by the U.S. Census Bureau to geographically represent a neighborhood. The country has 73,057 tracts that vary in square mileage yet have a standardized average population of about 4,000 residents.
Analysis of the world, from experts
We found that 69% of census tracts that have a post office lack a community bank – defined as having less than $10 billion in assets – while 75% don’t have a credit union branch. And 24% have neither, affecting nearly 21 million people.
The results varied widely from state to state. For example, in Arizona, 44% of tracts with a post office don’t have a credit union or community bank, while in Nebraska that figure is only 4%. And we found that members of minority groups tend to be located disproportionately in areas that lack banking but do have a post office.