Reserve Bank suggests using cash at a cost

Article published 8 January 2024

Subscribe to CPSA news

More people and businesses are going cash-free

THE Reserve Bank of Australia (RBA) deputy governor has said that a drop in cash transactions has put pressure on the system and the cost of keeping notes in circulation is going up.

The RBA has said that it remains committed to ensuring cash isn’t going anywhere – but that businesses will continue to be able to choose what transaction methods they want to offer to customers.

They’ve also said that there might need to be big changes to the system to make sure that cash stays around for those who want to use it. One of the ideas is that banks might consider combining their cash distribution services to save on costs.

Overseas, there are similar systems in place to ensure that regional areas can access banking services.

Another idea is that people who use cash might have to pay a premium to do so.

Spending money to spend money? How did we get here?

From cash rich to cash-free

Between 2010 and 2021, cash payments went from being the primary transaction type to a tiny 13%. Most people who are classified as ‘high cash users’ are over 65.

During the peak of the COVID-19 pandemic, many businesses went cash-free. In the aftermath, some haven’t gone back, despite pressure from some members of the public.

The cost of producing, transporting and processing cash only becomes higher and its use becomes less frequent. Regional areas, in particular, have been impacted by bank branch closures.

So, cheques are out, many digital and card transactions come with a fee, and now it might cost extra to use cash? Will there be any way to make purchases that don’t come with an extra fee?

The impact

Many Australians feel that there should be a requirement for businesses that sell essential items to accept cash. Some believe that every business should be compelled to accept any legal tender.

There are less ATMs and bank branches, meaning that we are paying more and travelling further to access our money. According to the Australian Prudential Regulation Authority (APRA) there are less than half the amount of fee-free ATMs than there were only a few years ago.

For some, this is a big problem that goes beyond consumer choice – and the people who are impacted most are people on a low income, people with disability, and older people.

Other people who might struggle to cope without access to cash are those experiencing domestic violence, who might put aside cash to escape financial control.

What happens if there is a system outage or natural disaster? Or to people who simply do not trust digital payment systems and are cautious about their privacy? It’s much harder to get scammed out of cold, hard cash.

People who rely on others to make purchases for them may not wish to give their card and PIN over to someone else. Without cash, it becomes harder to give pocket money and teach young people how to budget.

Cash makes it possible to spend money sensibly in contrast to the far-too-easy method of tapping a card or purchasing with just a click. It also makes it easier to give people sleeping rough a couple of dollars that might mean the difference between eating dinner or not.

Many of us want and need the security of cash, and it is not enough to say that cash will remain in circulation – it needs to continue to be accessible.

For more information please email our media contact at

Stay up to date with CPSA news and media releases

Our regular email newsletter provides valuable insights and information on topics such as pension entitlements, healthcare, government policies, and more.

  • This field is for validation purposes and should be left unchanged.