Post Office handled £3.29 billion in cash at its 11,500 branches in March 2023, the highest total since September 2022.
Business cash deposits rose 16 per cent month-on-month to £1.15 billion in March from £9.85 million in February, while personal cash deposits increased 6.7 per cent to £1.3 billion in March against £1.22 billion the previous month, Post Office said in a statement.
Post Office said business cash deposits were at their highest level since last August when £1.19 billion was deposited by business customers. However, personal deposits dipped 0.5 per cent year-on-year to £1.31 billion in March 2022, which Post Office attributes to continuing cash deposit limits imposed by banks on their customers.
According to Post Office, personal cash withdrawals rose 15 per cent month-on-month to £805 million in March from £702 million in February. Despite the imposition of cash deposit limits, it attributes March’s surge in cash deposits to increased footfall as a result of continued bank branch closures.
Excluding Christmas when cash withdrawals are usually at their highest (£3.294 billion was deposited and withdrawn in December), last September saw the previous high when £3.35 billion was deposited and withdrawn over the counter at post offices, the statement further said.
Since last December, Post Office has been warning that cash deposit limits introduced by the banks and requested by the FCA as part of a tightening of money laundering controls have had a significant impact on postmasters.
In March 2023, there were almost 5.7 million cash deposit transactions at post offices. That was up over 10 per cent month-on-month and over 11 per cent year-on-year. Last April, there were 4.86 million cash deposit transactions, Post Office added.
“It’s encouraging to see such a significant amount of cash handled by our Postmasters last month despite on-going cost of living challenges, new deposit limits, and continued tough retail conditions on the High Street,” said Martin Kearsley, director of Post Office Banking. “Postmasters rightly tell us that the bank branch closures mean they are the only location where consumers and businesses can do their banking, which is why we’re increasing banking deposit remuneration by 20 per cent.”
“We’re looking forward to operating many more Bank Hubs over the course of this year, as the roll out gathers pace, and supporting communities that have seen their local bank branch close,” added Kearsley. “Naturally when it’s announced that the last bank branch is closing in a town it creates much concern amongst residents and businesses. Our Area Managers are supporting Postmasters to reassure the community that everyday banking can be done at a Post Office with dedicated marketing materials or with stands at the closing branch.”
At the end of March, Post Office announced a £26 million package of remuneration improvements for postmasters. This includes, effective April 2023, a 20 per cent increase in the remuneration Post Office pays postmasters for handling cash deposits, building on a doubling in the per transaction rate for handling deposits announced last August, the statement concluded.
