Can Blockchain Save the U.S. Postal Service?
The U.S. Postal Service (USPS), striving to overcome inefficiencies and profitability that’s historically been much more often in the red than in the black, is exploring the use of blockchain technology to improve current services, provide new services and improve operations. To that end, the Office of the Inspector General (OIG), along with consulting firm Swiss Economics, recently released a report, “Blockchain Technology: Possibilities for the U.S. Postal Service,” outlining various ways the USPS could implement the technology. The USPS is the latest among banks, companies and government entities that have been exploring potential uses for blockchain, which is the underpinning for the decentralized currency bitcoin.
One of the main ways the USPS could use blockchain technology is for financial services, according to the report. Swiss Economics proposes the USPS use the technology to create its own financial platform the consulting firm terms Postcoin. The USPS offers money orders and international money transfers, among other financial services, and the study suggests the USPS could start “experimenting” with the blockchain platform to streamline the operations of these offerings, making them less expensive for the USPS and consumers, and speed up money transfers.
The study suggests that the USPS could branch out with new products, such as blockchain-based escrow services, such as P2P transactions, in which it would act as a third party for transactions that occur in the real world and online. Another possibility is currency exchange services at post offices and ATMs, enabling customers to pay lower transaction and exchange fees when buying foreign currency.
Among other benefits, the USPS also could use the technology for identity verification to facilitate secure and transparent financial transactions, and to improve supply chain management by better coordinating with third parties, such as UPS and FedEx, to expedite shipments.
This is not the first time the USPS has explored emerging payments technology. The OIG in 2013 issued a report examining the USPS’s participation in P2P commerce. A year later it issued an RFP to companies to determine ways to expand financial services, such as mobile payments, prepaid cards, small-dollar loans, check cashing and deposit products.