By Stewart Perrie – Yahoo Finance
Australian businesses and companies could soon cop huge fines if they don’t accept or carry cash. Politicians Andrew Gee and Bob Katter have introduced a bill that aims to keep physical money in circulation.
With the rise of digital payments and wallets, the use of cash has been declining rapidly over the last few years. But plenty of Aussies still love and depend on cash and they’ve told Yahoo Finance the slow transition to a more cashless society is impacting their ability to pay for essentials.
Gee and Katter’s bill hopes to prevent that from happening.
Are you affected by businesses going cashless? Email stew.perrie@yahooinc.com
The Keeping Cash Transactions in Australia Bill 2024 was submitted to parliament this week and the MPs believe it’s “crucial in protecting the availability and acceptance of cash payments across the nation”.
“Many people, across both my electorate of Calare and around our great country, hold concerns and fears that the use of cash for transactions in Australia is being phased out and will soon disappear,” said Gee said.
“Shockingly, while the law provides that banknotes and coins are legal tender, there is currently no legal requirement for banknotes or coins to be accepted for transactions in Australia.
“In other words, carrying Australian banknotes is no guarantee that you will be able complete a purchase in cash — it’s all at the discretion of the business. If a business gives you notice that it won’t accept cash it won’t have to.”
The bill calls for businesses that provide goods and services in “face-to-face settings” that are based in a “premises, structure or vehicle” must offer to accept, and must accept, payment in cash if the transaction isn’t more than $10,000.
If legislated, the maximum civil penalties for not upholding this rule would be $5,000 for a person and $25,000 for a body corporate.
Katter said it’s vital for physical money to remain in circulation, especially for regional and rural areas.
“Taking away cash, and thereby taking away the choices and freedoms of the people, is fundamentally unfair,” the Katter’s Australian Party MP said. “With cash, we control it; we control how we spend it and save it.
“If we go cashless, we relinquish our control to a handful of CEOs who run the banks. These individuals, who earn millions of dollars, can make decisions about our money with the mere click of a button.
Can businesses refuse to take cash?
Bob Katter sparked an almighty debate earlier this year after his $50 note was refused at a cafe inside Parliament House.
He was told the venue didn’t accept physical money and even though it offered to give the MP the meal for free, Katter didn’t let it go.
“Legal tender means you must accept it, it’s the law,” he said. “I fight the battle because otherwise all your freedom is gone.
“You can’t buy a loaf of bread without the bank’s permission. The banks will now have complete control of your life.”
Even though cash is legal tender, that doesn’t mean it has to be accepted everywhere.
“It is legal for a business to specify the terms and conditions that they will supply goods and services,” the Australian Competition and Consumer Commission stated.
“This includes whether they will accept cash payment. However, consumers must be made aware of these terms and conditions before they make a purchase. Businesses should be clear and upfront about the types of payments they accept, and the total minimum price payable for their goods and services.”
Australia ‘should follow’ Ireland
Ireland introduced its Access to Cash bill earlier this year, which sought to do the same thing that Katter and Gee want to do in Australia.
Under the legislation, supermarkets, pharmacies and convenience stores will be forced to carry physical money to ensure people all across the country can access cash whenever they need it.
The policy will also require a minimum number of ATMs to be available across eight geographic regions in Ireland. Banks and ATM providers could be penalised if they don’t stick to the new rules.
Cash Welcome campaign coordinator Jason Bryce told Yahoo Finance it’s vital something similar is introduced in Australia.
“Some people rely on cash, trust cash, they do their budgeting with cash, they take their money out on payday or pension day, and that’s their money for the fortnight,” he said.
“The people who use cash have rights and we think those rights are enshrined in law. They’re not. Australia needs to follow Ireland and ensure that people can use cash, our legal tender to buy their food, their essential groceries and their medicines.”
A poll of more than 10,000 Yahoo Finance readers revealed 83 per cent agreed that Australia should bring in similar legislation.
Why are some businesses going cashless?
Small and large businesses across the board have stated they will no longer accept cash and there are many reasons.
There’s convenience, transparency and safety. Also, a reduction in costs for businesses handling cash.
Then there’s wider impacts like helping combat the “underground economy”, and tax avoidance, which pulls as much as $10 billion from the economy.
Richard Holden, Professor of Economics at UNSW Business School, told Yahoo Finance that at the end of the day cash can be “costly and a hassle”.
“If you run a cafe, cash handling is a giant pain,” Holden said.
“You’ve got to have insurance, you’ve got to bundle it up at the end of the day and take it to a night safe. It takes staff time and it costs money.”
But they might soon have no choice but to deal with that hassle.
Get the latest Yahoo Finance news – follow us on Facebook, LinkedIn and Instagram.
What you need to know about the use of cash in Australia
- Fewer people are using cash due to the convenience of paying with phones, watches and cards.
- There isn’t a shortage of cash-withdrawal points, with around 20,000 ATMs plus supermarkets to collect from.
- There’s about $100 billion in cash floating around Australia – or 2 billion notes
- The government has not indicated cash will be taken out of circulation
- The Big Four banks have all ruled out going cashless.
- Average cash withdrawal has increased from $180 to $290.
- RBA: ATM withdrawals dropped from 77.9 million in December 2008 to 29.7 million in June 2023.
- Finder survey: 13 per cent of Aussies never use cash, 44 per cent use it once a week, and 42 per cent once a month or less.