(24 July 2024 – Australia) Jason Bryce reports that post-pandemic, cash withdrawals have been rising gradually with the value of notes on issue remaining elevated yet banks have continued to withdraw branch and ATM points of presence.
The Australian Banking Association (ABA), Armaguard, major retailers such as Coles and Woolworths and the cash industry currently have interim ACCC authorisation to discuss how the cash-in-transit industry can be sustainable.
The Big Four are effectively the custodians of the cash industry, as the only entities holding banknote distribution agreements to buy new notes from the RBA. But they have been stood by idly as the decline of cash in the economy gathers pace, instead ramping up revenue from merchant services and card issuance.
The recent global CrowdStrike ‘BSOD’ Microsoft outage also starkly highlighted the importance of avoiding an over-reliance on ‘cashless’ transacting at point-of-sale.
“Pre-COVID, demand and supply of cash was broadly in sync, according to data collected by the RBA, APRA and AusPayNet. ATM cash withdrawals were declining at around a similar rate as bank points of presence. Then something changed. Australia emerged from the COVID pandemic and demand for cash didn’t continue to dwindle away. Demand for cash went up” commented Freelance Journalist Jason Bryce.
“Now demand outstrips supply of cash leading to widespread consumer concern – and the current crisis in the cash industry. The ABA and its member banks can’t build a reliable, private, instant-settlement, surcharge-free payment system so there is no possibility of a foreseeable cashless future.”
“Therefore banks must do more than watch the cash industry disintegrate while offering band-aid, safety-net type solutions. Banks, retailers and government must support a viable, competitive, thriving cash in transit sector.”