People 'panic withdraw' cash amid coronavirus crisis

The same panic that stripped supermarkets bare has caused a spike in cash withdrawals, according to official RBA data, as people hoard their life savings at home.

People 'panic withdraw' cash amid coronavirus crisis

The same panic that stripped supermarkets bare has caused a spike in cash withdrawals, according to official RBA data, as people hoard their life savings at home.

Experts say the cash is unlikely to have been spent or re-deposited during the lockdown, and safe retailers have noted a spike in business.

"Over-the-counter withdrawals of cash from banks were elevated over the second half of March as some customers with large balances sought to hold precautionary funds," The Reserve Bank noted in last month's Financial Stability Review.

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Cash money stock

"This included a small number of customers making very large withdrawals (more than $100,000, and in some cases into the millions of dollars)."

The central bank was forced to "work closely with large banks and cash-in-transit companies to ensure branches had sufficient cash supplies".

The rise in cash hoarding is for two reasons, according to Swinburn University Professor, Steve Worthington.

"In times of crisis, people want to touch and feel their savings," Professor Worthington told 9News.

"And there is also an element of keeping the money out of the government's view. In some cases this can mean it isn't included in assets tests."

Director of Aus Lock and Safe, Jason Catlow, has noted a spike in demand for residential locks – particularly those rated for between $10,000 and $50,000 cash.

Source : 9 News More