📨 Personal Loan in Post Office

From Oct 12, Canadian consumers can get personal loans at post offices, under a partnership between TD Bank and Canada Post.

💰 This is the latest example that consumer lending spreads to consumers’ daily scenes - being offered at non-financial outlets.

The interest rate is roughly 10% - 20%. Amount $1K-$30K. Terms 1-7 years.

This is a loosely embedded finance - as the loan is not directly tied to purchase at Post Office.

TD is able to leverage the 5,000+ post offices throughout Canada as a distribution network, while the applications are completed online or via phone.

The success depends on how Post Office can effectively market the products, to the right customers, while handling its main job.

🇺🇸 In the US, a pilot in 4 areas by US Postal Service only won 7 customers since Sep 2021.

The pilot is a test to revive the once-booming postal banking in the US, which died in the 1960s when the deposit insurance system allowed banks to steadily win business.

The services offered in USPS pilot include check cashing, bill pay, and ATM access, as well as upgraded money orders and wire transfers.

From my limited experience in the USPS offices, they were always busy with a slow-moving customer queue. 🤷‍♂️

Sources: Canada Post, TD, CU Collaborate.

Image source: Canada Post

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