The U.S. Postal Service quietly began offering paycheck-cashing services at several East Coast post offices last month, testing a plan that financial experts say has the potential to transform how low-wage and underserved Americans access their money.

Postal customers can now redeem paychecks in Washington, Baltimore, Falls Church, Va., and the Bronx, N.Y., for Visa gift cards topping out at $500, an agency spokesperson said. Postal officials expect to expand the pilot into a fuller study with more locations and financial products, such as bill-paying services and ATMs, according to three people involved with the program who spoke on the condition of anonymity to discuss sensitive business strategy.

Postal banking has become a Democratic hobby horse in recent years, with activists and politicians saying it solves two problems: the Postal Service’s precarious financial condition and the barriers many U.S. households face to building wealth and accessing their money.

For the nation’s 14.1 million unbanked and underbanked adults, the plan presents a government-backed alternative to paycheck cashing stores and payday lenders, which target vulnerable populations with outsized fees and interest rates. Democrats embraced the idea years ago: Sen. Bernie Sanders (I-Vt.) made postal banking part of his 2016 and 2020 presidential platforms, and it was adopted by the Biden-Sanders Unity Task Force as part of President Biden’s 2020 campaign agenda….