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New Digital Check White Paper Examines Future of the Brick-and-Mortar Bank Branch, Likelihood of a USPS Postal Bank

Northbrook, IL -  Postal banking is unlikely to take hold in the United States in the near future – but its underlying principles could play a significant role in branch transformation efforts industrywide, according to a new white paper released by Digital Check Corp. this week.

Digital Check examined numerous postal banking systems around the world, and discovered most shared certain traits that might help private-sector banks deal with pressing issues such as declining foot traffic and rising branch transaction costs. Shared infrastructure, right-sized branches, and low-cost “agency” banking for basic transactions are all likely to play a role in the future of the brick-and-mortar branch, the paper surmises.

“While researching postal banks around the world, we found many of them had tremendous success in precisely the types of branch-sustainability situations with which private-sector banks are wrestling,” said Jeff Hempker, Digital Check’s executive vice president. “They tend to do an outstanding job at leveraging infrastructure to lower operating costs, and at surviving in areas that are often considered unviable for brick-and-mortar operations.”

The research originated from a 2015 proposal by the U.S. Office of the Inspector General to introduce financial services at more than 30,000 branches of the U.S. Post Office, which many viewed as controversial at the time. Due to the various political and logistical obstacles associated with such a project, the chances of a postal bank coming into existence are deemed low for the foreseeable future. However, said Hempker, private-sector banks should still take notice of the strategies that have allowed them to flourish elsewhere.

“If we’re asking the question, ‘Should the government start a bank?’ we’re missing the point. For most of these concepts, it doesn’t matter whether it’s the Post Office or the private sector doing it. We should be asking, ‘What can we learn from postal banks to make the branch more efficient?’ ”

Digital Check is the world’s largest manufacturer of check scanners and document capture products for teller capture, branch automation, remote deposit capture, and remote lockbox applications. Digital Check’s award-winning CheXpress®, TellerScan®, and SmartSource® check and document scanners are among the most cost-effective and reliable in the industry. The company also provides software solutions for image quality, vault processing, and remote monitoring of scanners across an enterprise. For more information, visit www.digitalcheck.com.

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