Banking Blog

Finance Blogs » Banking Blog » End of Saturday mail to hit consumers?

End of Saturday mail to hit consumers?

By Claes Bell ·
Wednesday, February 6, 2013
Posted: 1 pm ET

Hoping to mail off that bill at the last moment to avoid late fees? It better not be on a Saturday.

The U.S. Postal Service announced Wednesday it is ceasing Saturday delivery and pickup of mail from businesses and residences as of Aug. 1 to try to stem the massive losses it has experienced in recent years. Delivery of packages to homes and businesses -- and full service to post office boxes -- will continue six days a week, and post offices that now operate on Saturday will continue to do so.

"The Postal Service is advancing an important new approach to delivery that reflects the strong growth of our package business and responds to the financial realities resulting from America's changing mailing habits," said Patrick R. Donahoe, postmaster general and CEO, in a statement. "We developed this approach by working with our customers to understand their delivery needs and by identifying creative ways to generate significant cost savings."

The USPS reported an annual loss of nearly $16 billion in 2012, and Congress has been slow to implement reforms that could put it on sounder financial footing. The agency expects five-day delivery to save $2 billion per year after it's fully phased in. That's a small fraction of the agency's red ink. Indeed, a 2011 Government Accountability Office report concluded that "ending Saturday delivery would reduce costs, but comprehensive restructuring is also needed."

The USPS cited internal research and media reports indicating that 70 percent of Americans supported the move as a way for the agency to cut costs and improve its financial position.

For consumers, the impact will likely be felt in terms of payment flexibility and turnaround times for sending and receiving communications with banks.

For example, consumers who normally would have waited until after depositing their paycheck Friday before sending out a credit card payment Saturday will now face a choice between incurring late fees and hoping their paycheck clears before their payment does. Should that fail to happen, the result could be hefty overdraft fees on their checking accounts.

However, your bank's ability to receive any payments you manage to send will probably be unaffected, as many large businesses have special relationships with the USPS that allow them to receive mail more frequently than regular customers.

"We pick up from the USPS and process payments seven days a week, including all major holidays," says a spokeswoman for JPMorgan Chase & Co. "If a customer's payment arrives in the lockbox on a Saturday or Sunday prior to our 5 p.m. local time cut-off, we will date the payment as of that day."

Overall, the negative impact on customers may not be what it would have been a few years ago, thanks to direct deposit and the sort of Web-based financial innovation that's partially responsible for the Postal Service's dire financial straits. Many people now get their paychecks directly deposited, and electronic bill-pay and other online services allow consumers to pay bills instantly as soon as they have the money in their checking account to do so.

That being said, if you have lost your debit card or have some other urgent need to receive mail from a bank, you won't be able to do so on weekends any longer -- and that could lead to financial hardship for some.

What do you think? Will you miss Saturday mail delivery?

Update: Spokespeople from Citibank and Wells Fargo say they don't expect their ability to receive weekend mail to be affected.

Bankrate wants to hear from you and encourages comments. We ask that you stay on topic, respect other people's opinions, and avoid profanity, offensive statements, and illegal content. Please keep in mind that we reserve the right to (but are not obligated to) edit or delete your comments. Please avoid posting private or confidential information, and also keep in mind that anything you post may be disclosed, published, transmitted or reused.

By submitting a post, you agree to be bound by Bankrate's terms of use. Please refer to Bankrate's privacy policy for more information regarding Bankrate's privacy practices.
February 07, 2013 at 8:38 am

Why all the complaining. I guess people like junk mail because isn't that is what is in the mailbox these days? People pay bills and receives bills online. They do their taxes. Heck now if you recieve Social Security I believe come this March 2013 all checks will be eletronic. No more paper.

February 07, 2013 at 8:35 am

Also the Post Office is self funded. They do not use any tax dollars. So no your taxes won't go down.

February 07, 2013 at 8:33 am

The post office is $29 billion in debt and of that $11 billion is just to fund retirees and future retiress. We are not paying for improved or better service each time rates go up we are funding the retirement fund. Get into the 21st Century. We receives checks anymore via US Mail. they are all direct deposit. I receive and pay all my bills online except one. This has been going on for years. When I submit my credit payment online I know that in 24 hours it will be posted. As for the post office it may take 5-7 days. All the mail I get is 99 percent junk.

February 07, 2013 at 8:31 am

The Post Office is 100% controlled by Congress, while receiving NO tax dollars at all. Congress does not fund even one penny of the Post Office's budget. The Post Office is, and has always been, self-sustaining, but Congress has the right to control how they do business. They have been asking for years now to end Saturday deliveries, but Congress has failed to act. This is reprehensible -- by their inaction, Congress is dooming the Post Office! And to the gentleman who was concerned about receiving checks on Saturdays -- first off, do you get your deliveries in time to get to the bank before they close? If not, you might consider a PO Box. That would ensure you get your mail six days a week.

February 07, 2013 at 8:25 am

Who delivers the mail to places no one wants to go? Who gets the mail to our Vets in war zones when no one else can? Who works through the night numerous hours of overtime during holiday seasons to get those cards and gifts to our children and grand children, Mother's, Fathers on their special days? Who walks a package to your front door, rings the door bell and waits for an answer? Who has been doing it for over a hundred years without a complaint from customers who blame bills, junk mail and bad weather for all their postal issues? Who places a Christmas card, a little money and a thank you in their mail box during the holidays to show their appreciation for what appears is a thankless job? I do!! They are an agency/branch of the Federal government and follow orders and receive guidance from the same people who can't balance our nations budget and have created the biggest deficit in our history.Their finacial issues are not nor should be placed on the shoulders of those who work there but those in Washington who's priority is difficult to figure out.

February 07, 2013 at 8:19 am

I do not like this at all. I am a self-employed contractor, and I receive some of my checks on Saturday.

george wildes
February 07, 2013 at 8:16 am

Cutting the post office? Are they going to lower the taxes and fee's we pay. I don't think so..

Bob H
February 07, 2013 at 8:12 am

I worked for the Post Office for 20 years and resigned 2 years ago to go back to shcool. Some of these comments are 100% accurate. Bowever, mandatory overtime forced on letter carriers and bonuses to management in itself is destroying the Post Office. There is no need for six day delivery. @ Denise...The P.O. Boxes at the stations bring in 20% of the revenue which is much needed. The days of mail being delivered to our homes is coming to an end. Computers, cell phones, Kindles and Nooks are sending the P.O. to extinction just like the dinosaur.

February 07, 2013 at 8:10 am

For a very long time I've thought that the Post Office should get rid of Saturday deliveries. So I say, it's about time they got around to actually doing (or not doing) it.

We don't need to receive mail six days a week. No one will suffer waiting from Friday to Monday for their mail. This decision is a no-brainer. The only mystery is why it took them so long to take this action.

February 07, 2013 at 8:10 am

The reason the post office is unprofitable is because of the goverment. They are the only government agency that is required to prefund their retirement. They are forced to pay for benefits for employees they will never have. At last count they had a 13.1 billion surplus surplus.