Whistl has suspended its postal service in Liverpool, London and Manchester after potential investors decided to turn their back on the company.

Last month, LDC, a division of Lloyds Banking Group, decided against investing in Whistl, because of what it described as changes in UK postal market and a complex regulatory environment.

It means around 2,000 workers on zero hours contracts could now face redundancy

Whistl said: "Following the announcement from LDC that it would not proceed with the proposed investment to fund further rollout of E2E we have now commenced an extensive review of the viability and potential for the rollout of an E2E postal delivery service in the UK."

It added that it would begin consultations with employees affected by the suspension of the end-to-end service, and with their union representatives.

Whistl changed its name from TNT Post last year as part of a 2011 separation agreement with its former owners.

International courier ParcelHero was not surprised by the news. Spokesman David Jinks said: “The traditional door-to-door letter service is a labour intensive low-margin market in which it’s hard to make money.

“Even though Whistl cherry-picked the market, choosing to deliver only in areas such as London, Liverpool and Manchester, it has still found the going tough.”