Most businesses do accept cash, but most consumers are now preferring digital.Providing a payment method is simply part of being in business, given how often card systems go down or people are maxed out, having the cash option is necessary IMO
I tried to use my card at a business last week, it was not accepted so I paid cash on the spot.
I used the same card at my next shop one hour later and it worked just fine so glitches happen often enough to make cash an essential alternative.
In regional areas eftpos is often clunky even if working normally, on a 4 week touring holiday I would expect at least one problem with EFT somewhere
Yes, I agree with you there but there is a push by the banks and large business people to just use cards.Most businesses do accept cash, but most consumers are now preferring digital.
another area where digital is cheaper than cash is international travel, cash costs can be as much as 5% + lost interest + lost points.
I think the push to use cards is definitely coming from the consumer.Yes, I agree with you there but there is a push by the banks and large business people to just use cards.
This would make it more profitable for them, unfortunately this adversely effects small business people, regional and country cities, towns and villages and erodes a very large chunk of our personal privacy.
FWIW.I wonder how much this cost everyone involved -
I laughed at Telstra saying businesses need a backup for their eftpos. Business already pays a premium for Telstra because in country towns the competition doesn't quite have the coverage. And back-up? What does that cost & what are the complexities?
FWIW.
With the 3G network being made redundant, 3G modems are being replaced with 4G modems. All the 4G modems we've installed have dual aks failover SIM cards, one with the Telstra logo the other with the Optus logo.
As per the recent outage, when all our services went dark and no network provider was accessible how good that backup system is, remains to be seen.
The fragility of our comms. infrastructure exacerbates the fragility of going all cashless.
My bolds.I guess its a trade off between how inconvenient cash is every day vs how inconvenient rare outages are.
I mean using cash is a hassle every week, you have to go out of your way to source the cash, deal with change etc, and then sometime have your own personal "outage" when you realise you need $52.90 and you only have $51.20 in your wallet, or you left your wallet at home.
Sure, if there is a big outage we might have to go to an ATM, but aren't people using cash suffering through that inconvenience all the time?
My bolds.
Nope, not if one is into numismatics and especially coinage.
Here's one rarity to keep an eye out for.
I hate getting coins as change, especially when travelling over seas, its so much easier just to tap and have the perfect amount deducted from my chosen account, and leave the rest earning interest.My bolds.
Nope, not if one is into numismatics and especially coinage.
Here's one rarity to keep an eye out for.
Was listening to the CEO of CBA being interviewed today.He was saying that the shift to cashless society is being driven by the its customers, and how so many more do online transactions these days.
I think he was being a tad disingenuous in that the banks in cahoots with business have largely forced their customers to abandon cash.
By closing so many branches, or limiting the hours they open, by limiting the functions that are allowed to be conducted by the branch, by refusing to take bags of coins over a certain denomination.
Limiting the amount of cash held at a branch, limiting the amount that can be withdrawn from a branch, forcing people to make appointments to make even small withdrawls of cash.
Cheques became more expensive to both issue and process, the costs of bounced cheques and re presenting went through the roof.
It all adds up to force people away from cash.
The banks have used their fee structure to force people into online banking, then throw up their hands and say it was an act of God when it falls over.
Of course people have shifted to online banking and EFTPOS, but its been largely foisted upon them by the actions of the banks.
And why would the banks do that?
Follow the money.
Mick
‘Dangerous’: Bank-owned and fee-free ATMs are disappearing – and that’s a worry
Getting access to your own cash isn’t just getting harder – it’s costing a lot more too, and one leading expert says Aussies should worry.
The number of bank-owned and fee-free automatic teller machines has more than halved in the past seven years, replaced with privately operated devices that slug users up to $4 per transaction.
While major financial institutions rapidly shutter branches and mothball ATMs, major corporations and small-time investors alike are flocking to fill the void – and cash in.
Professor Steve Worthington from Swinburne University said banks, particularly the big four, have become “obsessed with their cost-to-income ratios”.
“Anything they can do to reduce their costs will improve the gap between their outgoings and their incomings, hence improving their profitability,” Prof Worthington said.
“One of the biggest costs for banks and other financial institutions is running branches, in terms of the premises themselves and the personnel in them. That’s why there have been a lot of branch closures.
“And very often, ATMs operated by major banks are located in their branches, so when they close a branch, they remove an ATM.”
Plummeting numbers
Since June 2017, banks have collectively closed 2100 of their branches, data from the Australian Prudential Regulation Authority (APRA) shows, with 424 shutting in the 12 months to June 2023 alone.
On top of those ATM removals, another major factor in bank-owned machines becoming an endangered species is the industry-wide decision in 2017 to stop charging customers of other financial institutions a $2 fee to withdraw cash.
At the time, it was heralded by the government as a major win for consumers, but in reality it marked the beginning of the end of fee-free and convenient access to cash.
When that decision was made, there were 13,814 bank-owned ATMs right across Australia, but by June 2023, that number had more than halved to 5693.
The number of bank-owned ATMs across Australia has more than halved in seven years. Picture NCA Newswire/ Gaye Gerard
Of those 8121 fewer machines, almost 23 per cent – or 1863 in total – were lost in regional and remote parts of the country, APRA data shows.
APRA doesn’t carry statistics on the number of non-bank ATMs in Australia and a spokesman pointed out that “there are no legal requirements for banks to operate ATMs or branches”.
However, in its latest annual report, the industry association Australian Payments Network reports that in 2022-23 there were a total of 24,695 operational ATMs in Australia. Subtracting the bank-owned machines reported by APRA suggests there are some 19,000 private devices.
That’s considerably more than every bank-owned machine combined in 2017 before financial organisations stopped charging customers to use them.
Privately owned and operated ATMs are growing in numbers.
The fact that private enterprises have swept in to take up market share suggests there’s still a place for ATMs, Prof Worthington said.
“There’s clearly still demand out there,” he said. “And it’s obviously very profitable.”
Indeed, APN reports a total of 358 withdrawals from ATMs in the 12 months to June 2023, which was up 5.5 per cent on the previous year, although a significant drop on the 2018-10 figure of 572 million transactions.
In 2020, ANZ sold all of its non-branch ATMs to currency management service provider Armaguard as part of its then-emerging network of machines.
That business, ATMx, now has 1750 machines across the country – and counting.
Cash is no longer king?
According to a report release by the Australian Banking Association (ABA), the overwhelming majority of bank transactions now occur digitally – 98.9 per cent.
Aussies have been the fastest adopters of mobile and cashless payments in the world, driven in large part by a “world-class payments infrastructure”, the ABA said.
The report also shows that Australia has a higher branch density than comparable countries at 24 branches per 100,000 people.
And the ABA pointed out that more than 3000 Australia Point outlets have banking capabilities, including deposits and withdrawals, via the Bank@Post service.
Thousands of bank branches have been shut down across the country in recent years. Picture: NCA NewsWire / Nicholas Eagar
In late 2022, the Reserve Bank released its sixth triennial Consumer Payments Survey, examining 13,000 transactions made by a representative sample of 1000 people.
The results suggest that in just three years, the share of cash payments halved from 32 per cent of all in-person transactions to just 16 per cent.
“If one considers all payments, including online payments, cash payments made up 13 per cent by number and around eight per cent by value in 2022,” the RBA said.
“While cash was used less across payments of all sizes, the decline was particularly pronounced for smaller-sized payments. Indeed, the share of payments under $10 made with cash nearly halved over the three years to 2022 … (while) cash use for higher value transactions also continued to decline, although at a slower pace.”
Banks say the vast majority of customer transactions occur digitally. Picture: NCA NewsWire / Nicki Connolly
Prof Worthington isn’t convinced by the RBA data, pointing out that a mammoth amount of money is circulating in the economy.
“It was determined by a group of people keeping a diary on what they’d spent and how they paid for it, and it was only 1000 people, so I think it’s pretty limited,” he said.
“Roughly speaking, if you were to collect all of the money that’s been printed and floating around, and divided it by Australia’s population, we’d each get about $4000. That’s a lot of cash.”
ATMs can be a cash cow
While major players are rushing into the ATM market, plenty of smaller and sole operators are also getting in on the action.
There are ATM brokers who make the process of buying or leasing and operating a machine pretty straightforward – and affordable.
Someone with an appropriate place to install one – for example, a convenience store or petrol station owner – can buy a brand-new ATM for between $8000 and $12,000, or a used one for as little at $3000.
Those without that kind of budget can rent an ATM for as little as $300 per month.
Private non-bank ATM operators are expanding their network – but many Aussies will pay a pretty penny.
The company engaged to process payments from the machine will typically take a cut of $1 per transaction, leaving the owner or renter to determine how much they get by setting the fee.
Privately owned machines can slug users as much as $4 per transaction, so an ATM in a high-traffic area, like an inner-city shop or a pub with a pokies lounge, can rake in big bucks.
Cash matters to many
An interesting paradox of the RBA’s findings on dwindling cash usage across the population is what the research reveals how attitudes to physical money.
While more and more Aussies are going digital, very few support the notion of a cashless society – in fact, most are vehemently opposed to it.
“Consistent with previous surveys, the 2022 (results) indicated that some Australians would be negatively affected if cash was difficult to access or if shops stopped accepting it as a payment method,” the RBA noted.
“Overall, just over one-quarter of respondents – regardless of how intensively they used cash – reported that they would experience a ‘major inconvenience’ or ‘genuine hardship’ if cash was hard to access or use.”
The importance of cash is made clear during natural disasters and tech failures. Picture: Liana Boss
Prof Worthington pointed out that for many people, cash is the only way for them to pay for goods and services.
“It might be someone who’s elderly or who has intermittent or no access to the internet, and for whom cash is vitally important,” he said.
“We’re also reminded time and time again about how important cash is when there are natural disasters. In Victoria recently when there were mass power outages, you couldn’t do anything all. The only way to get by was using cash.”
Similarly, the total outage of the Optus telecommunications network late last year left countless business owners unable to take payment via EFTPOS.
Research shows many Aussies aren’t keen for society to go cashless. Picture: Nicki Connolly
“If we don’t use it, we’ll lose it,” Prof Worthington cautioned.
“That’s the danger, that if we keep using less and less cash, then as with the bank branches and the ATMs, there’ll be less and less access to it – fewer ways to use it. Already we see merchants not accepting cash anymore.
“That could be a sign of things to come. I think that’s a dangerous (reality) to consider.”
What the banks say
As part of this story, news.com.au reached out to each of the big four banks to ask about their ATM networks, the trend of fewer bank-owned machines, and what it means for customers.
Westpac has invested significantly in technology and partnerships to offer its customers a vast network of fee-free ATMs.
For example, its customers can use ATMx machines without being slugged a charge.
“We are proud to offer our customers access to the largest combined fleet of fee-free ATMs of any of the four major banks in Australia, at almost 7000 locations nationwide, including 857 that are owned by Westpac,” a spokesperson said.
“Our customers can make fee-free withdrawals at Westpac, BankSA, Bank of Melbourne and St. George ATMs, as well as ATMs operated by Precinct, ATMx by Armaguard, and the other major banks.
“Customers can also withdraw fee-free cash over the counter in any of our branches and via Australia Post’s Bank@Post facility.”
Banks insist they still back cash. Picture: Getty
In response to a flurry of branch closures, CBA chief executive Matt Comyn has previously reassured customers that there are no plans to abandon cash.
It also has the largest footprint of branches of all banks in Australia.
“We have 1956 ATMs, which is the largest bank-owned ATM network in Australia,” a CBA spokesperson said.
“While the number of ATMs we offer has reduced, we have chosen to maintain the largest and most convenient network – which is twice as large as our nearest major bank competitor.”
NAB did not provide a response but it’s understand the bank has a policy that if it removes an ATM, a Bank@Post service must be accessibly nearby.
NAB also hasn’t privatised any of its ATMs and all transaction on its machines remain fee-free.
ANZ did not respond before publication.
I said in the case of an outage, I meant like you go to Cole’s and they say cash only or something.I like how we have people arguing against cash and saying that in case of network collapse, you will have the minor inconvenient to have to go to an atm.
Seriously not seeing the issue there?
Me and She both carry a bit of cash as an emergency back-up, but have a reasonable amount at home. We were caught out some years ago and that will never happen to us again.
Two relevant examples on the same day:in the case of an outage
Yeah, but life goes on.Two relevant examples on the same day:
Telstra has a significant 4G outage and they're suggesting it'll take up to 9 days to restore service. This being in parts of Sydney not the middle of nowhere.
Meanwhile CommSec died last night and is still dead now.
OK so neither's a bank but they're both examples of like things with substantial outage durations and in both cases they're very major companies in their respective sectors.
All this stuff is really quite fragile and the moment it fails, it fails outright.
Two relevant examples on the same day:
Telstra has a significant 4G outage and they're suggesting it'll take up to 9 days to restore service. This being in parts of Sydney not the middle of nowhere.
Meanwhile CommSec died last night and is still dead now.
OK so neither's a bank but they're both examples of like things with substantial outage durations and in both cases they're very major companies in their respective sectors.
All this stuff is really quite fragile and the moment it fails, it fails outright.
Why Going 100% Digital Might Not Be The Solution In Asia: Examining The Practicality And Limitations Of A Cashless Society
In a rapidly digitizing world, many Asian countries are going cashless in order to create better, faster, and cheaper payment infrastructure. But should 100% cashless be the goal?
While cashless transactions offer clear benefits, significant barriers exist to achieving a completely cashless society. Infrastructure limitations, inadequate digital literacy, and disparities in access to technology hinder the widespread adoption of digital payments in many Asian countries. In addition, cultural preferences and the role of cash in informal economies are tough to dislodge.
Advantages
Cashless payments offer numerous advantages that have led to their growing popularity. Firstly, they provide enhanced security compared to cash transactions. With cash, there is always a risk of theft or loss, whereas digital payments can be protected with encryption and authentication measures. This reduces the chances of fraud and provides peace of mind for both consumers and businesses.
Further, cashless payments offer convenience and ease of use. With a simple tap or swipe, transactions can be completed quickly, eliminating the need to carry around bulky wallets or count out exact change.
Additionally, cashless transactions provide a digital record of all transactions, allowing for easy tracking and budgeting. This can be particularly beneficial for individuals and businesses looking to manage their finances more efficiently. The convenience of digital receipts and transaction history also simplifies the process of returns or refunds for merchants and consumers.
China is obviously the case-study for going cashless, where nearly 90% of all retail transactions have gone digital.
Disadvantages Of Cashless Payments
Yet, despite these benefits, there are several important disadvantages to consider. One major concern is the issue of privacy. Cash transactions are anonymous, whereas digital payments leave a digital trail. This raises concerns about personal data security and the potential for data breaches. As more transactions occur digitally, individuals may become more vulnerable to identity theft or unauthorized access to their financial information. The informal economy is often resistant to digital as well as it may mean additional taxes or scrutiny of traditionally all-cash businesses.
Another disadvantage is the reliance on technology. Cashless payments require access to smartphones, card readers, or other digital payment devices. In regions with limited access to technology, such as rural areas or underdeveloped countries, going cashless can exclude a significant portion of the population.
Furthermore, cashless transactions are dependent on a stable and reliable internet connection. In areas with poor connectivity or frequent power outages, relying solely on digital payments can be highly problematic. This is evident in a country like the Solomon Islands where the majority of power generation is through relatively unreliable diesel generators. There, cash is certainly still king, is universally accepted, and does not rely on external factors for its usability.
Practical Limitations Of Going 100% Cashless
While the benefits of cashless payments are enticing, achieving a completely cashless society has several practical limitations. One significant barrier is the lack of adequate infrastructure to support digital transactions. In many Asian countries, particularly those with less developed financial systems, the necessary infrastructure for seamless digital payments is still in its infancy. The availability of card readers, point-of-sale (POS) systems, and online payment gateways is crucial for the widespread adoption of cashless transactions.
Another practical limitation is the issue of digital literacy. While the younger generation may be more comfortable with digital technology, there are still significant portions of the population, particularly the elderly, who are not as proficient in using digital devices or understanding digital payment systems. This lack of digital literacy can hinder the adoption of cashless payments, as individuals may be reluctant to embrace technologies they do not fully understand.
In addition to infrastructure and digital literacy, the cultural preferences, habits, and the role of cash in informal economies cannot be overlooked. In many Asian countries, cash is deeply ingrained in cultural practices, such as gift-giving or traditional ceremonies. The use of cash in informal markets and street vendors in many Asian countries is also the norm. These cultural and economic factors create resistance to the complete elimination of cash from society.
Banking The Underbanked
One of the primary goals of the cashless movement is to promote financial inclusion. However, the transition to a cashless society may ironically further exclude the unbanked and underbanked population.
The unbanked and underbanked population often face barriers such as a lack of identification documents, limited financial literacy, or low income levels, which prevent them from accessing banking services. For these individuals, cash serves as the main medium of exchange, allowing them to participate in economic activities and meet their daily needs.
Without the option to use cash, the unbanked and underbanked population may find themselves unable to engage in transactions, both formal and informal. This exclusion can deepen existing inequalities and hinder efforts to promote financial inclusion.
Looking forward
While the practical limitations and challenges surrounding cashless payments are evident, it is undeniable that the future holds significant potential for further digitization of financial transactions. As technology continues to advance and become more accessible, the barriers to adopting cashless payments are likely to diminish.
However, it is crucial to approach the future of cashless payments with caution and a focus on inclusivity. Striking a balance between cash and cashless payments is essential to ensure that individuals from all walks of life can participate in the economy. By considering the needs of the unbanked and underbanked population, addressing security concerns, and investing in infrastructure, societies can embrace the benefits of cashless transactions while safeguarding financial inclusion and accessibility.
Striking A Balance
While the idea of going 100% cashless may seem appealing, it is essential to acknowledge the practicality and limitations associated with this trend. Infrastructure limitations, inadequate digital literacy, cultural preferences, and the role of cash in informal economies pose significant barriers to achieving a completely cashless society.
By investing in infrastructure, improving digital literacy, and considering alternative payment methods, societies can pave the way for a more gradual and successful transition towards a predominantly cashless economy. Striking a balance between cash and cashless payments is essential to harness the benefits of digitization while ensuring financial inclusion for all.
As the cashless movement continues to evolve, it is crucial to foster a nuanced understanding of the complexities surrounding this trend. Only through careful consideration of practical limitations and a focus on inclusivity can we create a future where cash and cashless payments coexist harmoniously, empowering individuals and economies alike.
it will never be foolproofUntil the digital system is foolproof and not subject to intermittent faults, cash will be around to save its arse. All the small issues add up to big costs, that no bank is willing to talk about.
Another disadvantage is the reliance on technology. Cashless payments require access to smartphones, card readers, or other digital payment devices. In regions with limited access to technology, such as rural areas or underdeveloped countries, going cashless can exclude a significant portion of the population.Furthermore, cashless transactions are dependent on a stable and reliable internet connection. In areas with poor connectivity or frequent power outages, relying solely on digital payments can be highly problematic. This is evident in a country like the Solomon Islands where the majority of power generation is through relatively unreliable diesel generators. There, cash is certainly still king, is universally accepted, and does not rely on external factors for its usability.
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