'Cash is king.' Australia might soon be cashless. But not everyone is happy about it.

"Cash is king" according to many frustrated locals in regional and rural areas right now. And fair enough.

Earlier this month, Draw Out Some Cash Day was celebrated by many across the country. It actually started as an online petition, protesting the declining use of cash in everyday transactions. The campaign called for Aussies to visit their local ATM or bank branch and withdraw some money.

It resulted in countless towns being filled with signs that read "cash is king", highlighting just how important physical cash is for not only for the regions, but also many older Aussies. 

"It's a big issue, not only for our community, but many others," says Margaret who lives in a regional town. "People are saying that when you pay in cash, you get what you pay for. No extra deductions and charges. But using credit cards is costing you money."

These concerns aren't isolated. When is the last time you paid for something with cold, hard cash?

Now think about the last time you paid for your goodies with a credit card/debit card. There's a very high chance you had a fork out for a surcharge on top of the cost of your item(s) too. 

Watch: 4 money hacks that don't cut out your daily cup of coffee. Post continues below.


Video via Mamamia.

Now think about the last time you paid for your goodies with a credit card/debit card. There's a very high chance you had a fork out for a surcharge on top of the cost of your item(s) too. 

During the COVID-19 pandemic there was a decrease in cash transactions, and fair enough because physical money was considered germy and yucky. But it turns out we have actually been looking down the barrel of a cashless society since long before 2020. 

Some experts say going cashless as a society would offer us convenience, transparency and stability.

Others feel differently. Especially when surcharges are involved, meaning it actually costs us less to use plain old cash.

The rise of the surcharge. 

A report released by the Reserve Bank of Australia in November found that cash usage has generally been replaced with card payments. This comes with the growing number of businesses across Australia charging customers an additional fee when they pay by card.


It's known as the 'cost of acceptance', where businesses incur costs to process a transaction, therefore many of these businesses will charge a surcharge to make up for this. 

But there are rules.

Under guidelines set by the RBA and enforced by the Australian Competition and Consumer Commission, businesses aren't allowed to add a surcharge that's more than what it costs them to process a specific type of payment. Businesses that choose to set a flat surcharge fee rather than a percentage surcharge need to make sure it is no more than what it costs them to use that payment type.

The RBA estimates the average cost of processing different payment methods to be:

  • EFTPOS - less than 0.5 per cent.
  • Visa and Mastercard debit cards - between 0.5 per cent and 1 per cent.
  • Visa and Mastercard credit cards - between 1 per cent and 1.5 per cent.

So while it is legal for surcharges to exist, and most businesses are doing the right thing as per the guidelines, that doesn't mean it's not a pain in the pockets of consumers. 

Let's think about your morning takeaway coffee. Say it's $5.50 — add on a 1.5 per cent surcharge and it will be around $5.58. A classic margarita or cocktail these days can cost up to $25 (sadly for our wallets). Add on a 1.5 surcharge, and then it's about $27.38. The same scenario goes for a night out at for Italian food. A $30 pasta dish would cost around $30.45 if the same stakes apply. 

Now when we see these numbers, the surcharges look small. And yes, they are small. But they certainly add up.


A rundown. Image: Canva. 

For five takeaway coffees per week, the surcharges alone would total up to over $20 in a year.

Now add on every single other purchase you make, and the surcharges on top. 

It's costly.

As for who is using cash the most, the RBA data shows that it's the elderly, those on lower incomes and those in regional and rural areas.


Data shows that over the five years up to June 2022 that bank branch numbers have declined by 29 per cent in regional and rural areas across Australia. ATMs are becoming less frequent too, with some businesses now even refusing to accept cash.

Westpac has openly discussed their cashless plans with their chief executive of consumer and business banking Chris de Bruin acknowledging the struggle of regional and remote communities.

"We are having conversations around how we transform their communities, and how do they become a cashless town," the Westpac boss said to the Australian Financial Review

"One of the big risks [with] a small town is they have a carnival or horse race and have $200,000 of cash in a bag, and say 'I need to put it somewhere safe or drive 100 kilometres to a branch.' And we say: 'Why don't we just have no bag of cash, and you don't have to go anywhere.'"

What would a truly cashless society mean?

There would be fewer markets or car boot sales, no giving to the homeless, no giving to buskers, no gold coin donations or $2 treats from the school canteen.

A lot of people rely on using cash for privacy reasons too, especially domestic violence victim-survivors who have fled abusive environments and don't want to risk being tracked down by a violent former partner.


Dr Angel Zhong is a finance academic at RMIT who specialises in empirical asset pricing, digital finance, global financial markets, investor behaviour and the recent trends in retail investing. With this in mind, she knows a thing or two with all things money and the pros and cons of a potential cashless society. 

Speaking with The Quicky, she says that a cashless future for Australia is actually something that could be on the horizon.

"As part of my prediction as well as the consensus among other economists, it's really likely that Australia will become a functionally cashless society by 2030. We're not saying that bank notes will disappear. Your bank notes still have their value, but the meaning of a functionally cashless society means that cashless payments will become the dominant approach of payment," says Zhong. 

"We can't become a cashless society overnight, as we're not ready. There are cyber attacks, internet outages and vulnerable and rural communities that have weaker access to internet and online banking. We need to increase the investment in internet access and other infrastructure, as well as acknowledge the payment preferences of various age groups and provide education and support."

Time will tell as to whether Australia goes down the cashless route. But in the meantime, when purchasing my takeaway coffees I just might whip out some notes and coins to avoid the surcharge. 

Feature Image: Canva. 

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