Millennium Dash for Cash

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Pre-millennial tension is about to hit the banking world. In the midst of upgrading their computers and ATM machines for the millennium bug, a report issued in May of 1998 expressed fears of an unprecedented "run on banks' cash stocks."

The Association for Payment Clearing Services, which is responsible for processing checks and money transmission in Great Britain, estimates that the public will try to withdraw Pounds 13.5 billion in cash before Chrismas next year. The reason? The public's fear that the millennium bug will disable cash machine computers.

This is 50 per cent higher than the amount of cash normally withdrawn in December, traditionally the month where demand for cash is at its highest, and equates to Pounds 267 per head of population.

Demand for cash is also expected to be at an all-time high because of the extended holiday. There will be just two working days between December 24, 1999 and January 4, 2000. The British Government is currently considering whether New Year's Eve should also be a holiday.

In anticipation of a stampede for cash, banks and building societies are drawing up plans to hold extra stocks in the early weeks of December 1999. The banks are also spending more than Pounds 1 billion in a race to upgrade their computers.

Britons will certainly need the cash. The nation's 326,000 bar staff are expected to be able to demand Pounds 12 an hour instead of Pounds 3.50 on New Year's Eve next year. Some nannies in London are confident of picking up Pounds 500 for a night's babysitting and agencies are already taking bookings for babysitters.

London taxi drivers will not be able to increase their rates but private hire cars may be looking to triple or even quadruple their charges.

Source: Times Newspapers