More Britons are turning to cash to manage their budgets as prices soar, the Post Office said on Monday after seeing record withdrawals through its counters in July.
Personal cash withdrawals rose by almost 8% compared to last month to £801m, marking only the second time since December 2021 that they topped £800m.
With inflation in Britain hitting a 40-year high of 9.4% in June, the Post Office said more Britons are choosing to use cash to manage their budgets “often every day”.
The Bank of England warned on Thursday that a long recession is looming as it raised interest rates by the most since 1995 to try to deal with inflation. British supermarkets also said shoppers are buying less and shopping more often to better control their budgets.
The Post Office also attributed some of the withdrawals to holidaymakers who needed cash to “stay put” in Britain this summer, while the figures were also boosted by around £90m worth of payments to people eligible for government support on their electricity bills .
The popularity of cash in Britain has been falling for years, with debit card transactions overtaking notes and coins in 2017, helped by contactless payments, according to banking industry body UK Finance.
The trend accelerated sharply during the COVID-19 pandemic, with cash withdrawals from ATMs in July around 40% lower than pre-pandemic levels, statistics from UK ATM network operator LINK showed.
Post Office banking director Martin Kearsley said his data made it clear that Britain was anything but a cashless society.
“We’re seeing more and more people rely more and more on cash as a proven way to manage their budgets,” he said.
The Post Office, which has more than 11,500 branches, said personal cash deposits reached £1.35bn in July, up 2% on June, with a record £3.32bn of cash deposits processed in the month and withdrawals.
