Coles resumes receiving cash deliveries after halving withdrawal limit amid fears of Armaguard collapse | Coles


Coles has resumed receiving cash deliveries after Australia’s primary money transit company, Armaguard, secured emergency funding from its parent company to continue operating.

The supermarket giant said it will still halve cash withdrawal limits across its stores as the viability of the money delivery sector remains under threat due to more consumers and businesses shunning physical currency.

Coles was the first major retailer to stop money deliveries over concerns that its cash orders could get stuck in trucks if Armaguard collapsed.

“Coles can confirm that normal cash collection and processing services from Armaguard have resumed,” a spokesperson said on Thursday afternoon.

“Customers can continue to pay with and withdraw cash at Coles supermarkets and liquor stores this weekend and ongoing.”

The Linfox-owned Armaguard warned late last year its business model was unsustainable due to falling demand for physical currency, sparking emergency meetings with Australia’s major banks and big retailers. The Reserve Bank, which prints and issues currency, is also involved in discussions.

On Thursday, Armaguard rejected a $26m rescue package from the big banks and retailers, citing concerns over conditions attached to the bailout.

Linfox will instead put $10m into its currency delivery business to ensure it can continue deliveries, while it seeks a longer term solution.

Armaguard’s chief executive Mick Cronin said on Thursday the company was working with customers and stakeholders on financial solutions.

“Armaguard rejects the timing ultimatum by the [Australian Banking Association],” Cronin said.

“Armaguard continues to operate its full suite of services and is confident that over the coming months, it will get the business on to a long term sustainable footing with appropriate support from the industry.”

Anna Bligh, the ABA chief executive who led negotiations on behalf of the banks and retailers, said the “generous cash offer” was subject to reasonable conditions, which included Armaguard sharing information about its finances to enable all parties to find a viable model.

“This offer of financial support was made in good faith to ensure the last major cash-in-transit company can continue to serve its customers,” Bligh said.

“However, it is entirely up to Armaguard to decide how to fund their business and the decision of the parent company Linfox to fund them is a welcome development.”

Concerns have been growing that if Armaguard, which has a near monopoly over coin and note distribution in Australia, were to reduce or cease deliveries, there would be a cash shortage affecting banks, post offices, supermarkets and other major retailers.

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Coles has reduced its cash withdrawal limit from $400 to $200, with the changes putting it in line with many other retailers.

A Woolworths spokesperson said there were no changes to its cash limits or operations.

In Australia, cash usage has dropped to just 13% of transactions, according to professional services firm Accenture, down from 27% before the pandemic.

The money transit sector had anticipated there would be a rebound in cash usage as lockdowns eased, however that failed to materialise.

While cash usage is falling, many people still rely on notes and coins, including older Australians, those with limited or no internet access, people on low incomes and those with a disability.

Most retailers receive periodic cash deliveries, which means they keep enough money on hand for any short-term disruptions, although there are concerns consumers might rush to withdraw cash if supplies come under threat.

The consumer commission has noted the industry response would need to make sure cash is available in remote and regional areas, where bank branches are limited and people often access money through other sources such as post offices and supermarkets.

The Transport Workers’ Union has called on the major banks to provide a long-term solution to fund the cash transit industry.

“It’s critical for the safety and wellbeing of these transport workers that this is resolved quickly with a view to the future,” the TWU national secretary, Michael Kaine, said.

“With the public holiday approaching, workers need certainty and peace of mind.”



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