Armaguard Resumes Cash Deliveries: Coles Adjusts Withdrawal Limits Amidst Declining Physical Currency Usage

Coles has resumed accepting cash deliveries following emergency funding secured by Armaguard, Australia’s primary money transit company, from its parent company. Despite this, Coles will still halve cash withdrawal limits across its stores due to ongoing concerns about the stability of the money delivery sector. The decision comes amidst a trend of declining physical currency usage by consumers and businesses.

Initially, Coles ceased money deliveries over fears that its cash orders could be compromised if Armaguard faced collapse. However, a spokesperson for Coles announced that normal cash collection and processing services have resumed, allowing customers to continue paying with and withdrawing cash at Coles supermarkets and liquor stores.

Armaguard, owned by Linfox, had previously signaled the unsustainability of its business model due to decreased demand for physical currency. Despite rejecting a $26 million rescue package from major banks and retailers, Armaguard received $10 million from Linfox to ensure continued deliveries while seeking a longer-term solution.

Mick Cronin, Armaguard’s CEO, expressed confidence in finding a sustainable financial solution with the support of customers and stakeholders. The Australian Banking Association (ABA) had made a generous cash offer, contingent on reasonable conditions including financial transparency from Armaguard.

Concerns persist over potential cash shortages if Armaguard were to reduce or cease deliveries, affecting various sectors including banks, post offices, and supermarkets. Coles has aligned its cash withdrawal limit with other retailers, reducing it from $400 to $200.

Although cash usage has declined to 13% of transactions in Australia, many individuals, particularly older Australians, those with limited internet access, and low-income earners, still rely on physical currency. The Transport Workers’ Union has urged major banks to provide a sustainable solution for the cash transit industry, emphasizing the importance of worker safety and wellbeing.