Cash Use Has Dropped to Just 13 Percent of All Transactions: RBA Report

People queue for ATM machines outside a branch of the Commonwealth Bank in Melbourne on Aug. 8, 2018. William West/AFP via Getty Images

Cash use for everyday transactions in Australia has dropped sharply, from 70 percent in 2007 to just 13 percent in 2022, according to the Reserve Bank of Australia’s (RBA) latest consumer payments survey.

Report released on Jan. 30 says while digital payments dominate, cash remains essential for some Australians.

The pandemic accelerated the decline, but the demand for cash has since stabilised, with key indicators like ATM withdrawals and point-of-sale cash-outs showing continued use.

The survey also found that 7 percent of Australians are “high cash users,” relying on cash for 80 percent or more of in-person transactions. This group is predominantly older Australians and those with lower incomes, for whom cash is often the only payment method available.

Additionally, the survey revealed that one-quarter of respondents would experience significant hardship or major inconvenience if cash were no longer accessible.

The number of ATMs in Australia has dropped by over 9,100 since late 2016, mainly due to fewer ADI-owned ATMs (ATMs owned by banks, credit unions, and building societies).

Independently owned ATMs now account for a larger share of the market. ATM closures slowed in 2024, with 95 percent of ADI-owned closures in major cities.

Government and RBA Commitments to Cash Accessibility

The RBA remains committed to ensuring cash remains a viable payment method for those who rely on it.

RBA Governor Michelle Bullock emphasised the importance of cash as both a precautionary measure and a store-of-wealth for many Australians.

In a recent speech on modernising Australia’s payment system, Bullock said cash was a vital backup when digital payment systems fail, such as during outages or natural disasters.

“The importance of cash is evident during events when digital payment systems are unavailable,” Bullock said. “It’s crucial that we ensure cash remains a reliable option for those who need it.”

The federal government has also taken steps to support cash as a fallback payment method.

Assistant Treasurer Stephen Jones highlighted the risks posed by the increasing reliance on digital payments, particularly when systems fail, and the necessity of cash as a backup.

“Sometimes systems go down, sometimes electronic payment systems don’t work,” he said.

Cash Mandate and Consultation Paper

In response to concerns about cash access, the government introduced legislation in November 2024 mandating that businesses must accept cash for essential purchases, such as groceries and fuel.

This move came after widespread concerns about the growing impact of digital payment failures on consumers.

“We’ve all been standing in a queue at a supermarket or a shop where the EFTPOS or payments system has gone down, and the power’s out. We want to ensure that such issues don’t become a crippling event across the economy,” Jones said.

A consultation paper released by the Treasury on Dec. 20, 2024, sought public feedback on the scope of the mandate, including questions around compliance measures, the definition of essential goods and services, and whether small businesses with an annual turnover under $10 million should be exempted from the requirement.

The consultation period is set to end on Feb. 14, and the final details of the mandate will be announced later in the year, with full implementation scheduled for Jan. 1, 2026.

Treasurer Jim Chalmers, alongside Jones, reinforced the Albanese government’s commitment to ensuring cash remains part of Australia’s payment landscape.

“People are increasingly using digital payment methods, but there will be an ongoing place for cash in our society under the Albanese government,” they stated in a joint statement.