Coles Lifts Cash Withdrawal Limits as Armaguard Services Resume

Shoppers check out at a Coles supermarket in Sydney, Australia, on March 16, 2018. William West/AFP via Getty Images

Shoppers will continue to be able to withdraw cash at Coles this Easter after the supermarket giant resumes cash delivery services with the transport company Armaguard.

This comes after Coles temporarily paused all currency orders with Armaguard until April 5, while reducing withdrawal limits for customers from $400 (US$261) to $200, due to concerns that the cash transit company could go into administration and cause cash shortages.

However, shortly after Coles announced the pause, Armaguard told the supermarket that it was confident of staying financially viable in the long term, prompting Coles to resume delivery orders by the afternoon of March 28.

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

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

The Financially Troubled Company

Founded in 1938, Armaguard grew to become the monopoly cash transit business in Australia.

However, the company has encountered financial difficulties due to a significant drop in cash delivery demand in recent years as Australian consumers and businesses switch to online transactions.

Following its merger with competitor Prosegur, Armaguard approached some of the nation’s biggest retailers and banks in October 2023 and requested them to provide funding to keep the company afloat.

On March 19, the big four banks, Wesfarmers, Coles, Woolworths, and Australia Post offered Armaguard a $26 million rescue package, which was enough to support the company for about six months.

While the deal does not require Armaguard to repay the support amount, the company has to adhere to certain conditions.

On March 28, Armaguard rejected the deal as the company did not want to open its books for due diligence.

Instead, the company announced it had secured funding from its parent company, Linfox, and would negotiate with clients to turn around the loss-making business.

“Armaguard confirms it is working constructively with all its customers, including its retail customers, banks, and other key stakeholders regarding both short-term and long-term financial solutions for the industry to remain sustainable,” chief executive Mick Cronin said in a statement.

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

Armaguard’s decision comes amid an ongoing push towards cashless transactions across Australian society.

In early March, Bankwest, a commercial bank in Western Australia, announced that it would close 45 branches in the state to transition to a digital-only bank.

The bank claimed that 97 percent of its transactions were completed digitally, and only two percent of customers visited a branch.

The move prompted harsh criticisms from the Finance Sector Union while raising concerns about the future of cash transactions in Australia.

Monica O'Shea contributed to this article.