ATM cash withdrawals in Australia declined slightly in 2014, down to $57.3 million in February this year, compared with $60 million in February 2013. This is because debit/credit card payments are continually growing, according to a new Australian Payments Clearing Association (APCA) report.
The report, entitled Focus on Cash, (PDF) also found that in 2013, 47 per cent of payments in Australia were made with cash while 43 per cent were made using debit or credit cards.
Some 3 per cent of payments were made via BPAY while 2 per cent of all payments were made using Internet banking.
According to APCA, the number of cash payments has declined by 5 per cent since 2005, down to $11.7 billion in 2013.
“This decline is predicted to accelerate, dropping a further 20 per cent over the next few years before it plateaus in 2018,” read the report.
According to APCA CEO Chris Hamilton, the decline can be attributed to Australian’s love for `tap and go’ cards, which the user simply waves over a PayPass or PayWave reader. The payment method does not require a PIN to be entered but the payment limit is capped at $100.
“Consumers are going to find that cash is not their first choice any more, even for convenience items like a coffee. Increasingly, they may find that automated consumer services will accept a wide range of digital payments – but not cash,” he said in a statement.
In related news, consumers can no longer sign when they make purchases on their debit and credit cards in Australia. Instead, people now need to use a PIN – part of a move by Australian banks to decrease card fraud.
The move to PIN is being rolled out gradually between 1 August and 18 October 2014 to give time for people to get used to the change. Approximately 800,000 point of sale (POS) terminals in Australia need a software update as the country phases out signature-based credit and debit card payments.
Follow Hamish Barwick on Twitter: @HamishBarwick