In total, £2.87bn was deposited and withdrawn in cash last month with personal cash deposits reaching £1.2bn, the fourth month in a row they have exceeded £1bn, according to the Post Office’s Cash Tracker.

Business cash deposits exceeded £1bn for the first time in over 18 months, totalling £1.02bn.

Personal cash withdrawals were up almost 10 per cent month-on-month, reaching £636m, the highest amount withdrawn from Post Office counters since March 2020, excluding Christmas.

The Post Office said the figures show that millions of individuals and business owners still rely on cash despite a decline in the number of ATMs and bank branches.

A Post Office survey of more than 500 UK small businesses last week revealed that two thirds feel that cash use is important to the recovery of the UK retail industry post-lockdown. Nearly 1 in 5 said that they depended on their local Post Office branch for cash and banking services.

Further research found that 72 per cent of UK consumers believe that cash is an important consumer right.

The Post Office has called on the government to bring forward legislation to ensure access to cash becomes a legal right, with a requirement on banks to provide cash withdrawal services free at the point of service for those who need it.

It said around eight million people would struggle day to day without cash, while 1.4 million people do not even have a bank account and rely exclusively on cash to survive.

Martin Kearsley, banking director at Post Office, said: “Millions of people and small businesses continue to rely on cash to budget, save and survive. Exceeding £1bn in business cash deposits for the first time in over 18 months is a milestone moment for Post Office and especially for Postmasters, demonstrating the vital role they play in the cash eco-system in their local community as we come out of Covid 19 restrictions.

“Many branches open late in the evening and at weekends, providing local businesses with a convenient location to deposit much needed takings and in turn serve their own customers longer too. The ability to withdraw cash securely over the counter is helping consumers who rely on cash to access it locally, resulting in more cash being spent with small businesses within local communities.”

Research by Which? shows 4,188 bank branches have closed since the start of 2015, a rate of approximately 50 per month.