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Reserve Bank of Australia data released on 7 September 2020 shows Australian consumers have rushed back to cash after an initial COVID-19 related scare campaign.
There were 45 million cash withdrawals worth $10.6 billion from Australian ATMs in December 2019, that number fell to 22 million worth $6.5 billion in April2020 as the global virus pandemic set in.
Cash withdrawals have now almost completely recovered, back up to 35 million, worth $9.9 billion inJuly. The recovery in cash withdrawals comes despite a sever economic downturn and the closure of many entertainment and dining venues.
“These numbers are encouraging considering Victoria is still in hard lockdown,” said Tim Wildash, CEO of NextPayments, Australia and New Zealand’s biggest independent ATM network.
“Australians have rushed back to using cash after some initial messages from card companies suggesting cash is dirtier than cards, which is simply not true.”
“These numbers represent a vote of confidence in cash and a strong statement thatAustralians want to keep their right to access and use cash.”
The bounce in ATM cash withdrawals also comes despite a fall in the number of ATM machines from 27,958 in December 2019 to 25,719 in June 2020.
More than seven thousand ATMs have been removed from communities throughout Australia in the last three years according to the AustralianPayments Network. 175 bank branches have also gone in the last12 months.
“Removing ATMs and bank branches hurts communities, shopping centres and the economy,” said Tim Wildash.
In the financial year ending 30 June2020, Reserve Bank data shows cash accounts for more than 10 per cent of consumer payments, despite a surge in cashless payments during COVID-19, encouraged along by card companies.That’s down from 13 per cent a year earlier.
Without cash, many people are disadvantaged and retailers are vulnerable to eftpos system outages, like the huge Westpac outage this week.
<blockquote class="twitter-tweet"><plang="en" dir="ltr">There are currently issues withWestpac Live Online and Mobile Banking - we're working to fix theseASAP and will keep you updated here.</p>— Westpac Bank(@Westpac) <a href="https://twitter.com/Westpac/status/1302756115143294976?ref_src=twsrc%5Etfw">September6, 2020</a></blockquote> <script asyncsrc="https://platform.twitter.com/widgets.js"charset="utf-8"></script>
Reserve Bank moves to protect our right to cash
The Reserve Bank of Australia is moving in 2020 and 2021 to protect our right to access and use cash. The RBA’s recently released corporate plan for 2020-2021. Explains how the regulators are interested in providing consumers with low cost ways to pay at the Point of Sale.
The Reserve Bank is committing itself, in 2020 and 2021, to“work to support the ongoing provision of cash services, given that cash is still used heavily by some segments of the population.”
That could mean encouraging banks to maintain ATM and bank branch networks. The RBA will also conduct research and consult the industry on policies around “the ongoing provision of cash services.”
‘The RBA will have a major review into electronic & card payments in 2020/21 …’
At the same time, the RBA will conduct a “major review” focused on electronic and card payments. That could mean more work building on previous inquiries into interchange and merchant fees on card payments.
In relation to the health advice, now the RBA and other regulators are carefully not distinguishing between payment methods and focusing on hand hygiene as the key message to consumers and retailers.
The World Health Organisation, RBA and Mint advice has been consistent – cash is no more susceptible to virus transmission than other common surfaces,including cards and POS terminals.
“TheWHO, the RBA, the Mint and state health departments do not recommend against using cash. They recommend good hand hygiene at the point of sale whatever payment system is being used,” said Tim Wildash.
While the death of cash as a payment instrument has long been prematurely predicted, the reality now is coming into clear view – cash will be around forever because people and merchants love cash. And government and regulators are listening at last and moving to protect the role of cash in our economy.
