Fall in deposits at UK Post Offices
New figures today reveal a fall in business cash deposits at UK Post Offices in December, attributed to last month’s rail strikes, freezing weather and on-going bank deposit limits impacting the hospitality sector.
Business cash deposits totalled £1.09 billion in December, a fall of 2% month-on-month (£1.11 billion, November 2022). This is down on the record £1.2 billion worth of business cash deposits set in August 2022.
Post Office has also attributed the fall in business cash deposits to newly introduced deposit limits that some banks have set as part of a tightening of money laundering controls. This has resulted in limits on the amount of cash that some customers can deposit over the counter at Post Offices. The recent introduction of these limits has already started to impact thousands of legitimate small and independent businesses and risks undermining legislation being debated in Parliament to protect Access to Cash by making it hard for those businesses to then pay their cash back in.
Personal cash deposits totalled £1.28 billion in December, dipping 0.5% month-on-month (£1.29 billion, November 2022). In total, Post Offices handled £2.37 billion worth of deposits in December, down 1.2% month-on-month (£2.40 billion, November 2022).
Martin Kearsley, Banking Director at Post Office, said: “December was a torrid month for the hospitality sector amongst others, with strikes and freezing weather reducing footfall and cash takings across pubs, cafes and restaurants especially; and in turn contributing to a fall in deposits at Post Offices. Small businesses are the backbone of the British economy. Over-zealous limits imposed on the amount they are able to deposit is resulting in more businesses no longer being able to accept cash, impacting both their ability to trade as they would like, as well as their customers who need or choose to budget using cash. They must remain able to deposit their takings locally, securely and conveniently without having to suspend or disrupt trading to make an ever longer journey to a distant bank branch to deposit their takings.”
Personal cash withdrawals
Personal cash withdrawals totalled a record £892 million in December. This was up 6.7% month-on-month (£836 million, November 2022) and up 11% on December 2021 (£801 million).
The increase in personal cash withdrawals coincides with the Post Office’s renewed partnership with the Trussell Trust. Since November last year, Post Office has been donating 1p from every cash withdrawal and hopes to raise £330,000 for the charity over the winter. In addition, Post Offices are also providing energy relief payments, winter fuel payments and cost of living payments in cash on behalf of the Government and local councils to vulnerable people.
Martin Kearsley added: “Millions of people continue to visit their local Post Office to withdraw cash in order to budget and Postmasters are playing a vital role in helping people, particularly those on low incomes, navigate this Winter. In addition to cash deposit and withdrawal services, Postmasters are processing tens of thousands of Energy Bill Support Scheme vouchers for prepaid meter customers every week.”
In 2022, £38.4 billion worth of cash was deposited and withdrawn over the counter at Post Office’s 11,500 branches. This compares to £32.1 billion in 2021.