BACK PAGES:THE PROBLEMS created by the absence of credit are all too familiar today, but what about an absence of actual cash? That was the situation facing many in 1970 during a prolonged strike by the main retail banks, in an era when electronic transfers and foreign banks were not as widespread as today, and ATMs (and competition among banks) did not exist.
Pre-strike, to get cash from an account you had to visit the bank during its limited opening hours, or write a cheque to someone who would cash it. A report in the newspaper summed up how businesses were faring after the first three weeks without banks.
Scarcity of cash for pay grows
THERE HAS been a gradual drain of ready cash out of the country since the bank strike began on May 1st last. The money is being used chiefly to pay bills for goods being imported by stores and supermarkets but there is also a considerable amount being invested on a short-term basis by foreign banks operating here.
Many large employers are finding it increasingly difficult to find cash with which to pay their employees and to carry on their business at the same time. CIE, which during the last bank strike provided ready cash to firms, is at present lodging its surplus through an American bank.
The Central Bank is making “limited facilities” available to non-associated banks and is issuing coin in minimum quantities of £500 . . . [It] is also providing facilities for the Department of Finance and local authorities for the payment in cash to all employees who request it. Arrangements for the distribution of the money is being made by the various Departments . . .
The non-associated banks have had quite a large increase of business because of the strike and their staffs, which have been increased by bringing over English officials, are now working up to 8pm at night. These banks are “taking a tough line” as regards new accounts but in “special cases” they are allowing people and firms to open accounts . . . Supermarkets, large department stores and other concerns which depend to a large extent on cash discount for their profit margins, have been forced to send cash to Northern Ireland in order to pay for the goods which they import. Companies outside the State are refusing to handle Irish cheques until the strike is over.
CIE has refused to act as a distributor of coin to companies as it did during the last strike, and the reason given was that last time the company had to mount a 24-hour guard on the place where it was keeping the money, as well as insuring it, and the whole operation cost a lot of money.
CIE has, since the last strike, become a customer of an American bank, mainly, it was pointed out, because of its tourist commitments in North America. There is a turnover of £140,000 in cash a week on Dublin buses, but part of this is being used to pay CIE staff. The remainder is being deposited in the Central Bank.
Another semi-State company, the ESB, is still accepting cheques as payment of its accounts, but also has enough ready cash to pay its employees.
The position then is, that while there is not an immediate shortage of ready cash, the situation could arise where many firms would find it nearly impossible to pay their staffs in cash. The cement strike, which is now in its 15th week, is also a factor which contributes to minimising the effect of the strike.
http://www.irishtimes.com/newspaper/archive/1970/0519/Pg001.html#Ar00103