Barclays to limit cash deposits from July

Nigel Farage has accused banks of wanting to ‘kill off cash’ – Daniel Harvey Gonzalez/In Pictures

Barclays has been accused of trying to ‘kill cash’ with plans to strictly limit how much customers can deposit.

From July, an annual limit of £20,000 will apply to the amount of cash which can be paid into Barclays personal accounts, including any associated children’s accounts.

The limit will then be reset in January of each following year. Any cash paid in at branch counters and at self-deposit machines will count towards the total.

Former Ukip leader Nigel Farage was among those to condemn the change, telling The Telegraph: “The banks want to kill cash. Their behaviour is a disgrace.”

The high street bank follows the lead set by NatWest, which caps deposits to £3,000 a day, or £24,000 in any 12-month period, after changing its rules last September.

The bank was last year accused of moving customers towards a “cashless” society when it made the changes amid a “debanking” scandal sparked by Mr Farage when private bank Coutts closed his account over his “xenophobic, chauvinistic and racist views”.

The fallout led to Dame Alison Rose, the chief executive of NatWest stepping down, after she admitted to being a source for an inaccurate BBC story.

While the change is ostensibly to protect against financial crime and money laundering, critics said that it was another way for banks to stop customers using branches.

Martin Quinn, of the Payments Choice Alliance, said: “It might sound like a lot, but imagine if you sold a car, were paid in cash, with nothing illegal taking place. According to the bank, you must be money laundering.

“The real reason I fear is that Barclays wants to continue to erode the branch network, close branches and force us all online.

“Without a branch how can you pay cash into your account? They want to make it as hard as possible for the British public to safely deposit cash.”

Community banking campaigner Derek French described it as “another limitation to suit the banks’ admin rather than customer needs”.

Cash use has been in sharp decline since before the pandemic, which accelerated the switch to cards by exacerbating hygiene concerns.

Cash made up 10pc of point of sale transactions in 2023, the 2024 Global Payments Report by Worldpay found. But it is projected that this will drop to just 6pc by 2027. It is primarily older customers who still use cash, alongside some of the most vulnerable.

Everyone living in the UK should have access to a cash machine within three miles of their home, the Prime Minister, Rishi Sunak, said last summer.

But as of the end of 2023, there were less than 48,000 ATMs across the country, down from a high of more than 70,000 in 2016.

A Barclays spokesman said: “We take financial crime and our responsibility to prevent money laundering seriously. We have contacted customers to let them know that from July we are making some changes to the amount of cash customers can deposit into their Barclays accounts.

“We have set the limit at an amount that will allow us to better identify suspicious activity, while still ensuring our customers have access to cash.”

A NatWest spokesman said: “We have a duty of care to protect customers, communities and society from the effects of fraud and financial crime and we’ve introduced some changes to our terms and conditions to help us to do that more effectively.

“We review our policies regularly and always seek to balance our responsibilities with the needs of our customers.”

The Post Office also applies an annual limit of £10,000 for personal customers, and £240,000 for those with business accounts.

While Santander does not apply a limit, customers depositing large sums may be asked to give an explanation for where the money comes from.

HSBC has no current plans to introduce a limit, a spokesman confirmed, although the bank “does keep its policies under review”. Lloyds Banking Group said that no changes were planned.

Harriett Baldwin, chairman of the Treasury Select Committee, said: “While I understand many more people are depositing cash digitally than a decade ago, I’m concerned a move in this direction could effectively mean those reliant on cash find it even harder to access the banking services they need.”

A spokesman for the city regulator, the Financial Conduct Authority (FCA) said: “Banks have a responsibility for reducing the opportunity for the criminal misuse of their services. We raised concerns about the money laundering risks from cash deposits at the Post Office. Banks put limits in place, in addition to other steps, as a result. Some have chosen to extend these to their own branches. However, consumers must still be able to use cash services through bank branches and the Post Office.”

Will you be affected by the new deposit limits? Email [email protected]

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