The use of cash as a payment method will see a “near total” disappearance in Australia as the COVID-19 pandemic accelerates global shifts in consumer and payment trends.
Only 2.1 per cent of payments Down Under will be made in cash by 2024, according to new predictions made by FIS in its latest Global Payments report.
Cash made a “hasty retreat” last year as people were forced to shop online amid lockdowns that shuttered brick-and-mortar stores.
“COVID-19 is accelerating the pace of cash’s decline faster than even the most bullish projections,” the report said.
“The pandemic accelerated the decline of cash by over three years, exceeding in 2020 our previous projection for 2023.”
During 2020, less than 10 per cent of point-of-sale transactions in Australia were made with cash.
And this figure is set to drop further over the next three years, so much so that cash will effectively disappear from Australian society.
“The decline of cash will be near total in some markets, falling to … 2.1 per cent in Australia,” the report said.
Meanwhile, the take-up of digital wallets – which encompasses PayPal, Apple Pay, Android Pay and Samsung Pay as well as Google Wallet, Alipay and Venmo – soared across Asia Pacific last year, making up more than 24.1 per cent of payments in Australia.
How do Aussies actually feel about going cashless?
Despite the forecast, Australians haven’t been too keen on going entirely cashless.
According to MyState Bank research from July 2020, two in three Aussies have been using less cash since COVID-19 hit – but seven in 10 aren’t in favour of a completely cashless society.
The research found that cashless payments’ extra merchant fees and potential network outages were major detractors.
Days ago, Woolworths pulled the plug on its cashless store trials amid huge backlash and criticism that it was potentially alienating certain groups.
This sentiment has been echoed by MyState Bank CEO Melos Sulicich.
“Our research indicates that, as a nation, we are not ready for cash to be banished completely,” he said.
“It is important for banks to support those who may struggle with the transition to a predominantly digital model as not all Australians have the means to eliminate cash.
“There are people in our society who would struggle in a cashless society such as the elderly, the homeless population and those with disabilities.”