New analysis from investment platform Lightyear shows that UK firms are now holding £597 billion in deposits – up 27% since the pandemic began.
The figures, which combine data from the Bank of England and ONS, reveal that business cash holdings have grown slower in the five years since COVID than in the years before it – indicating a shift in corporate behaviour away from cash preservation.
The total cash pile — measured by deposits in currency and repos — held by UK non-financial businesses grew by £126 billion to £597 billion between 2019 and 2025. By contrast, cash holdings grew by a significant £157 billion between 2013 and 2019, indicating less emphasis on cash wealth for Britain’s firms today, as compared to ten years ago.
Cash holdings in electricity, gas and heated water suppliers highest
Electricity, gas and heated water suppliers have seen the biggest increase in absolute cash holdings since the pandemic. Since 2019, their collective holdings have risen 118% to £18bn. By contrast, mining and quarrying businesses have seen a drop in cash wealth, -6% since 2019.
On a per-business basis, however, mining and quarrying firms come out as the most cash-rich, holding an average of £25 million in deposits per company in 2024, nearly eight times the average business’ account size.
Other relatively cash-rich sectors include utilities (average deposits of £3.5m per business) and business services (average of £548,000). In the least cash-rich sector, construction, the average business held just £152,000 in deposits last year.
High street banks erode potential for returns
The growth in deposits comes as Lightyear’s analysis reveals high street banks’ offering for businesses is eating away at their potential returns on savings. Across instant access business accounts, the UK’s biggest banks offer interest rates as low as 0.6% (Lloyds Bank), or 0.85% (Metro Bank), compared to the current Bank of England base rate of 4%.
On average, traditional banks offer a rate of 1.45% for instant access business accounts, penalising firms that require flexibility and liquidity in the short-term. Coupled with growing cash reserves since the pandemic, businesses may therefore be looking for alternative ways of boosting deposits.
Wander Rutgers, UK CEO of Lightyear, said: “This data shows just how much cash UK firms have built up. But while companies have bounced back since the pandemic, cash wealth isn’t what they’re chasing. We’re seeing demand from companies looking to get more from idle capital, especially when high street banks keep interest rates deliberately low. Firms that value higher returns and flexibility are rightly looking for alternative places to park their cash, like money market funds.”
