Cash payments in Australia are disappearing faster than most retailers realise, with usage plummeting to just 13% of transactions by 2024. Cash usage is rapidly declining and will probably not be viable for many by 2030. We are now looking at a cashless society.

The shift away from cash represents both a challenge and an opportunity for Australian retailers. The question isn't whether this change will happen but whether your business will be prepared when it does.

Recently, I attended a major conference that perfectly captured where Australia is heading with payment methods. At this two-day event with hundreds of delegates and speakers from both internationally and in Australia, I witnessed something that would have been unthinkable a while ago. On the first day, I went to pay for lunch with cash and had the exact amount ready. The cashier looked genuinely surprised and told me I was the only person to pay with money all day. Everyone else had paid with a card.

The second day was even more telling. I had a twenty-dollar note and needed change, but the cashier couldn't process my payment because she had no change. The organisers hadn't planned for cash transactions. It was a mainstream event, yet cash had become so rare that my usage caught everyone off guard.

This experience isn't unique anymore. It's happening across Australia, signalling a fundamental shift that every retailer needs to understand and prepare for the cashless society.

The Data Reveals the Scope of Change

The Reserve Bank of Australia's data paints a stark picture of cash's decline in our economy. Cash payments have plummeted from around 70% of all consumer transactions in 2007 to just 13% in 2022, and current data show about 10%.

The Australian Banking Association has projected that by 2030, cash will represent just 4% of all transactions. To put this in perspective, cash usage fell by over two-thirds between 2014 and 2024. It isn't just about younger generations preferring digital payments; the shift is across all demographics.

Infrastructure Changes Drive Payment Evolution

The conference experience I shared highlights a critical issue beyond consumer preference: the infrastructure supporting cash transactions is actively breaking down. Businesses are no longer equipped to handle cash because they don't expect it.

Bank branch closures have accelerated dramatically across Australia. The number of ATMs per 100,000 people has dropped by more than 15% between 2012 and 2021. If this decline continues at the current rate, the last will be switched off by mid-century. ATM withdrawals have crashed from 75 million per month in 2009 to just 28 million today.

It means your business's support system for cash transactions is actively disappearing. Even if you want to accept cash, your customers might struggle to access it, and you will find it increasingly challenging to bank deposits or obtain change for your tills.

The situation with Armguard, Australia's most significant cash-in-transit business, facing financial troubles earlier this year, demonstrates how precarious the cash infrastructure has become. When the company that moved most of Australia's cash around nearly went under, it exposed how dependent our remaining cash economy was on increasingly fragile systems.

Regional Considerations Present Unique Challenges

If you're operating in regional or remote Australia, your situation differs from that of retailers in significant cities. Cash usage remains higher in regional areas due to older demographics and less reliable digital infrastructure.

However, bank branches and ATMs are also disappearing fastest in regional areas. It creates a problem because regions where cash is needed most are losing the infrastructure to support it more quickly. Some communities are becoming genuinely vulnerable to further reductions in cash services.

Regional retailers might experience a slower transition from cash, but the infrastructure challenges are more severe. You might be one of the few businesses still accepting cash simply because your customer base demands it, while struggling to manage the practical aspects of cash handling.

Government Mandates Face Market Reality

You've probably heard about the government's plans to mandate cash acceptance for essential items like groceries and fuel starting from January 1, 2026. On paper, this sounds like a lifeline for cash. The reality proves more complex.

The proposed mandate will apply to businesses selling essential goods and services such as food, fuel, and basic healthcare. Still, there's already discussion about exempting small businesses with an annual turnover of under $10 million. This exemption could cover many of the retailers reading this article.

The critical question remains: even if the government mandates cash acceptance, can it mandate the infrastructure to support it? Legislation can force a supermarket to accept your twenty-dollar note, but it cannot force banks, ATMs or cash transport companies to remain profitable.

The energy for serious legislative action has waned in Australia's political landscape since the failure of the recent cash-out day, which was seen as an informal vote on cash's future. Also, the government likely views the end of the cash economy favourably for many reasons: it's cheaper, easier to track transactions for tax purposes, and reduces the underground economy.

Business Implications Demand you make a Strategic Response

As a retailer, you're now in the middle of this transition.

The costs of handling cash are substantial and often underestimated. You need floats, extra insurance, time for counting and banking, secure storage, and regular trips to deposit some money. When businesses struggled during COVID-19, these inefficiencies became impossible to ignore. Many retailers discovered they could eliminate significant overhead by going cashless.

However, there's a flip side to consider. Recent surveys show that whilst digital payments are rising, Australian shoppers still want the option to use cash. More concerning for your bottom line, in-store debit and credit card fees are now the most hated fees among consumers, ranking even above ATM fees. The government's response to this pressure seems frightening: get rid of debit card fees and make retailers absorb these fees.

Technology Solutions Provide Competitive Advantage

Your point-of-sale systems have evolved to handle this transition seamlessly. Today's POS technology can efficiently manage multiple payment types, including various digital wallets and contactless options. It positions your business for the future while maintaining current capabilities.

Use its reports to determine your business's cash handling costs, including salaries, time, insurance, banking fees, and security measures. When properly calculated, you might be surprised at the real expense. In my experience, many retailers discover that the hidden cash handling costs shock them.

Strategic Timeline for Australian Retailers

Based on current trends and infrastructure changes, here's my assessment of the realistic timeline facing Australian businesses:

2025-2026 Period

Cash usage continues to decline.

Soon, large companies will be mandated to accept it, and many small businesses will receive exemptions.

2027-2029 Phase

Cash usage continues to decline.

Cash access is difficult in many areas as more banks and ATMs are closing. Businesses find compliance with cash mandates growing in cost and time.

2030 Transition Point

We have a cashless society.

Cash will reach the projected 4% of transactions. At this point, cash will move from a mainstream payment method to a niche service, similar to how cheques function today, still technically available but rarely used.

Beyond 2030

Cash persists only for emergencies and specific cases; mass acceptance effectively ends.

Practical Business Recommendations

We need to prepare strategically. Your approach should be measured and customer-focused. Most retailers I've talked to have told me they intend to keep cash going as long as their customers keep using it. I doubt it. As my experience at the conference shows, even though I wanted to use cash they could not accept it.

Assess Your Customer Demographics

If you serve predominantly older customers or operate in a regional area, you must maintain cash acceptance longer than urban retailers serving younger demographics.

Calculate Real Costs Accurately

Track your business's cash handling costs, including salaries, time, insurance, banking fees, security measures, and opportunity costs. One point often missed is that an electronic transaction is usually higher than cash, so keeping cash may cost you lost sales. Many retailers underestimate these expenses. Use your POS system's reporting capabilities to get precise data on transaction costs across different payment methods.

Communicate Payment Policies Clearly

Whatever payment methods you accept, ensure customers know before they reach the checkout. Clear signage not only prevents awkward situations and improves customer experience, but it's also often the law.

Conclusion

Your success in this transition depends on preparation, not resistance. By understanding the timeline, investing in appropriate technology, and developing a clear strategy, your business can thrive regardless of how payment preferences evolve.

Written by:

Bernard Zimmermann is the founding director at POS Solutions, a leading point-of-sale system company with 45 years of industry experience. He consults to various organisations, from small businesses to large retailers and government institutions. Bernard is passionate about helping companies optimise their operations through innovative POS technology and enabling seamless customer experiences through effective software solutions.

Cash Out Day is tomorrow, 22 April 2025. It is a practical reminder that many Australians value cash as a payment. As digital transactions have surged, the movement to keep some money viable has gained real traction. Last year's Cash Out Day drove a 6.2% spike in ATM withdrawals and up to 14% increases in some shopping centres. Most people felt there was no need to withdraw cash unless they went to a place like a shopping centre where they could spend it.

It showed that many Australians still value access to cash.

Supporting Cash Out Day is not just about being opposed to technology (a Luddite); it's about ensuring that cash as a payment method is necessary for our community now.

The Evolving Role of Cash in Australian Retail

Cash usage in Australia has declined sharply. It now represents 13% of consumer transactions, down from 70% in 2007. This shift has created a crisis for cash as the infrastructure needed to support it becomes less viable, e.g. nearly half of all bank branches have closed since 2011, ATM numbers have dropped by over a quarter since 2016, and Armaguard has been struggling due to the dramatic decline in cash usage across Australia. It has been creating a potential crisis, according to the ACCC, for the estimated "one in four Australians who would face genuine hardship or major inconvenience without access to cash."

Does Cash Acceptance Still Matter for Your Business

Customer

The ACCC stated, "Cash is the preferred payment method for approximately 1.5 million adult Australians, who rely on it for over 80% of their transactions." By accepting cash, you ensure your business is accessible to these customers, too.

Financial Benefits

Often forgotten is that Cash payments offer immediate settlement. They eliminate the settlement periods associated with electronic transactions and avoid the processing fees that come with card payments. These fees average around 1.5% per transaction for SMB retailers. These fees are also unfair as they affect SMB retailers more than large retailers.

Additionally, cash provides operational resilience. Digital payment systems experience outages. I had a customer who lost over $8,500 when his EFTPOS went down for most of the day. Australia does not yet have the infrastructure to support a cashless society.

Regulatory Developments

The Australian Government has stated it recognises the importance of cash, but no one has seen it do much. Their recent proposal to force businesses to remove EFTPOS surcharges is unfair as it stands as they have not answered who is supposed to pay this cost. I doubt the goverment intends to pay it.

Practical Steps to Support Cash Out Day 2025

If you want to support Cash Out Day 2025 actively. Here are practical actions you can take to demonstrate your cash commitment:

Take some money out of an ATM

It is what the organisers want, and it indeed is, as you can see that this statistic has been widely quoted. Simply go and take some money out of an ATM. 

Then tell your friends to do the same.

Display Window Signage

Put a sign on your shopfront stating "Keep Cash" or "Cash Welcome Here." This simple gesture signals that you value cash.

Sign and Share the Petition

The Cash Welcome campaign's petition has gathered over 200,000 signatures advocating for guaranteed cash access and acceptance.

Click here if you want to sign.

Create In-Store Promotions

Consider offering a small discount or bonus item for cash purchases on Cash Out Day. After all, many people will have more cash tomorrow and are looking for where to spend it.

The Future of Cash in Australia: Strategic Balance

While digital payments will continue to grow, I feel, and I hope you do, that cash will remain a vital part of the Australian economy for the foreseeable future.

Written by:

Bernard Zimmermann is the founding director at POS Solutions, a leading point-of-sale system company with 45 years of industry experience. He consults to various organisations, from small businesses to large retailers and government institutions. Bernard is passionate about helping companies optimise their operations through innovative POS technology and enabling seamless customer experiences through effective software solutions.

The Australian government plans to introduce a mandate requiring businesses to accept cash for essential items. This initiative aims to support those who rely on money and ensure the resilience of the payment system.

I don't know what an essential item is. I doubt anyone knows.

Many of my clients have given up on cash, but many more are committed to it.

Key Points of the Proposal

• Businesses selling essential items must accept cash payments
• Appropriate exemptions for small businesses The consultation period is open until 14 February 2025
• Proposed implementation date: 1 January 2026

Implications for Australian Retailers

While these policy objectives aim to protect consumers, they may present specific operational challenges for you.

Current Cash Usage Statistics

• 13% of transactions in Australia were made using cash in 2022
• 1.5 million Australians use cash for over 80% of in-person payments
• Up to 94% of businesses currently accept cash

Click here for more details

The Treasury seeks feedback from businesses like yours to shape the final policy.

If you want to supply feedback, here's how you can contribute:

1. Review the consultation paper on the Treasury website here

2. Submit your response by 14 February 2025

3. Share your unique perspective

International Context

Similar cash mandates have been implemented in countries like Spain, France, Norway, Denmark, and some US states.

Stay Informed and Prepared

The retail landscape in Australia is evolving, and staying ahead of regulatory changes is crucial for your business success. This cash mandate could significantly impact your daily operations, from technology investments to staff management.

Over the years, I've seen a rapid improvement in retail technology. One problem in retail today is the wait in a queue for people waiting to buy. This frustrates customers, leading to many lost sales.

Self-Checkout Technology

Self-checkout cash registers have become common in larger stores. Customers scan and bag their items and pay without a cashier. This retail innovation helps reduce queues and staffing needs, as one person can manage eight cash registers.

Benefits of self-checkout:

• Shorter wait times
• More checkout options during busy periods
• Reduced labour costs for retailers

Challenges with self-checkout:

• Some customers dislike using the technology, so you still need manned cash registers.
• These cash registers have high setup costs as they are expensive cash registers.
• It is not worth it for shops with low turnover.
• Higher rates of shoplifting. A recent study here of 5,000 transactions found that self-checkout lanes had 16 times higher shrinkage rates than traditional cashier lines. About 6.7% of self-checkout transactions had some amount of partial shrinkage versus just 0.32% with cashiers.

These are significant problems for retailers considering self-checkout technology. Several stores have removed their self-checkouts as a result. 

AI in Retail: The Next Frontier of Checkout

.One promising solution uses AI.

How AI-Powered Cashierless Stores Work

This "grab and go" approach eliminates the need for scanning, potentially reducing theft by automatically addressing shoplifting while creating a smoother checkout experience. I can see the potential here as someone who's worked closely with POS systems.

Conclusion

The retail landscape is changing. While queues and theft remain significant challenges, new technologies offer promising retail queue management and shrinkage prevention solutions. As a POS provider, we're committed to helping retailers of all sizes navigate this evolving terrain.

Have you experienced these new checkout technologies as a customer? What are your thoughts on the future of retail? If you are in Melbourne or Sydney, you can see it in operation where it is on trial at ten 7-Eleven Australia stores here: 

7-Eleven Cranbourne North (945 S. Gippsland Highway Cranbourne North)
7-Eleven Truganina (1/475 Leakes Road, Truganina Vic)
7-Eleven Craigieburn (264-270 Craigieburn Road Craigieburn Vic);
7-Eleven Doreen (8 Whitford Way Doreen Vic)
7-Eleven Tarneit (32 Escapade Street Tarneit Vic)
7-Eleven Braybrook (87 Ashley Street, Braybrook Vic)
7-Eleven Richmond (Building 2/658 Church Street, Cremorne Vic)
7-Eleven Burwood (Parramatta Road, Burwood, NSW)
7-Eleven Northmead (137 Windsor Road, Northmead NSW)
7-Eleven Graystanes (601 Great Western Highway, Greystanes NSW)

I recently had a surprising experience at a large supermarket. I went to pay and was told to go to another cash register as this one could not handle cash! While I'd seen this once at a trade show, it was the first time it had been in a mainstream store. This got me thinking that we are genuinely nearing the end of cash, despite what banks and governments say. Soon I expect many shops will introduce a surcharge for cash.

The Australian Cash Exodus

The numbers don't lie. The Global Payments Report predicts a dramatic shift – by 2025, cash will likely account for just 2% of the value in all point-of-sale transactions. It's not going away entirely, but other methods will dwarf the amount we spend using physical cash.  Unsurprisingly, it notes that ATM withdrawals also decline as people ditch cash.

Convenience and Security

We are also seeing the successors to credit and debit cards coming with digital wallets on our smartphones. These are far more secure. Think about it: a thief can potentially use a stolen card, but with a smartphone app, they'd need your phone, access to it, and usually your fingerprint. It's a big leap in protection!

Brick-and-Mortar Retailers: Time to Adapt

This cashier-less trend isn't just curious; it's a real opportunity for small businesses. Here's why upgrading your point-of-sale system makes sense:

- Efficiency:  No more fumbling with notes and coins means faster checkout. Customers love speed!

- Improved Security:    Less cash on-site drastically reduces the risk of theft.

- Enhanced Customer Experience:   People demand payment choices; cashless often feels to them secure and streamlined.

Embracing the Cashless Evolution

The retail world changes quickly. To stay ahead of the game, adaptability is key. Cashless point-of-sale solutions aren't just a trend but likely the future standard.

A Personal Note

Change can be unsettling – I remember when cards themselves were the new, scary thing! The same will happen with the shift away from cash. I know we now have and are selling cashless registers.

Ready to Make the Shift?

Our POS software is designed with both cashless and traditional payments in mind. Get your free consultation today, and let's future-proof your business together!

Picture this: A pensioner goes shopping; in her wallet are a few notes ready to use for shopping. Soon, most vendors will wave her towards card readers instead. "Just tap and go." They say, "It's faster!" Could this be our future?

Don't Panic, Cash Isn't Disappearing Overnight

According to some estimates, by 2030, Australia will be a cashless society. While this shift won't happen overnight, it will significantly affect businesses like yours.

Why the Cashless Craze for retailers?

• Faster: Tap-and-go payments are quick and easy. Our POS System can do such transactions faster than cash, I know, as we have measured it.
• Cost: Retailers save on handling, counting, and securing physical cash.
• Security: For retailers, handling electronic money is much more secure and more challenging to steal—lower risks of counterfeiting and internal theft for retailers when using electronic payments.
• Fewer banks and ATMs: Cash can be a problem as we have fewer banks and ATMs.

Hold On, Not So Fast – Retailers Are Concerned

Recent studies paint a complex picture.

• Few cashless support: A whopping 71% of Australians are worried about going cashless, and many retailers are among that 71%.
• More payment types: Few retailers want to lose customers, so if a customer wants to pay in cash, most retailers will accept it.
• Hidden Fees: Every fee counts, and a cashless society costs retailers.

The Real Risks of Going Cashless

It's not just nostalgia. Here's why all business owners should care:

• Leaving Folks Behind: The elderly, those with disabilities, undocumented workers, and even domestic abuse victims may rely heavily on cash. Going cashless can exclude them.
• Your Data, Their Data: Card companies and banks see every transaction, raising privacy concerns. Large companies now buy this information from banks, providing incredible information on what people buy from their cashless purchases.  
• Outages Happen, and Australia's electronic network is not ready: When the power or network goes down, currently, only cash keeps things moving.

So, What's a Business to do?

First, check what percentage of your sales are cashless versus cash via your POS reporting. The "End of Day" report will show a "Sales Payment Breakup" - run this for the past year to understand your current cash/cashless mix.

With this data in hand, you can plan appropriately:

Go to the main menu and select "End of day."

Click where it has a green arrow.

The part of the report you are looking for is the Sales Payment Breakup below.

Pick an appropriate period, generally the last year. Run it a few times with slightly different dates, as you may get a better value with various dates. 

This will supply you with the information you need.

Conclusion

1. Keep SOME Cash Handy: It's an emergency lifeline and a way to serve everyone.
2. Speak Up! Let your local council and politicians know a fully cashless Australia has drawbacks.

Australia's transition away from cash is complex. With proper planning and an inclusive "fair go" approach, small businesses can thrive by straddling both cashless and cash payments during this shift.