As we navigate through the digital age, the way we handle our finances is undergoing a seismic shift, and it’s one that could have profound implications for Australians who may have grown accustomed to traditional banking methods.
The head of the Australian Banking Association (ABA), Anna Bligh, has recently shed light on a future where bank branches and cash transactions could become relics of a bygone era.
In an era where convenience is king, digital payment methods such as cards and smart devices are reigning supreme, with physical cash becoming increasingly rare.
This shift towards a cashless society is not just a trend but a transformation that Bligh describes as the ‘biggest in the history of the country’. The implications of this revolution are far-reaching, affecting everything from the physical layout of bank branches to the services they offer.
‘If people aren’t coming in anymore to withdraw or deposit cash, then that really changes what a branch is and what it might look like in the future.’
The statistics are telling: in 2007, 70 per cent of transactions in Australia were conducted with cash. Fast forward to today, and that figure has plummeted to around 10 per cent.
The Reserve Bank of Australia (RBA) projects an even steeper decline, with cash transactions potentially dropping to a mere 4 per cent by 2030.
This decline in cash usage is reshaping the banking landscape, with branches evolving to meet the changing needs of their customers.
For many Australians, the local bank branch has been a cornerstone of financial management. However, as Bligh points out, the reduced use of cash means that the traditional services offered by these branches are becoming obsolete.
The ABA chief highlights that 75 per cent of all home loans in Australia are now facilitated by mortgage brokers who offer the convenience of coming to your home, further reducing the need for physical bank branches.
In response to these changes, some banks are experimenting with new branch formats. Westpac, for example, has introduced Service Centres in regional areas of New South Wales, Victoria, and Tasmania.
These centres are not your typical branches; ‘They’re not quite like the old branch that you once knew, but it is a face-to-face experience,’ Blight said. They lack traditional teller services for cash withdrawals but offer SmartATMs, face-to-face support, digital banking assistance, and fraud and scam support.
This hybrid model could be indicative of the future of banking, where personal interaction is available but the focus is on digital services.
The transition to digital banking has not been without its challenges. Hundreds of bank branches have closed in recent years, with a Canstar analysis revealing 230 closures in the 2023-24 financial year alone.
While the Big Four banks have agreed not to close any more regional branches until at least 2027, the future beyond that remains uncertain.
Despite the convenience of digital banking, there is a segment of the population that still values cash. A recent grassroots protest saw Australians withdrawing money en masse from ATMs, banks, and supermarkets to send a message that cash remains important.
This highlights the need for a balanced approach that caters to both digital natives and those who prefer traditional banking methods.
For our readers at YourLifeChoices, the message is clear: the banking world is changing, and staying informed and adaptable is essential.
Whether you’re a tech-savvy individual who embraces digital banking or someone who values the tangibility of cash, understanding these trends will help you navigate the future of money in Australia.
We encourage you to share your thoughts and experiences with the shift towards digital banking. Have you found the transition to be smooth, or do you face challenges with the decline of cash and bank branches? Your insights could help shape the conversation and ensure that the needs of all Australians are considered in this digital revolution.
Also read: Is cash still king? A go-to spot backtracks on cashless policy after customer outrage
Once Australia goes cashless and totally cybered – then that’s when we’ll need the Duttons/Sco-Mos/Abbotts/Leys/Taylors/Cashs/Humes/Ruddocks/Pynes/Hansons/Joyces/Vanstones/Ruddocks and Palmers to step up and “poke the Dragon”
They would not know how?
My kids don’t carry any cash, everything is done by card.
My youngest in Grade 10 only wants her allowance by transfer to her account as it’s not cool to use cash anymore. They all have cards from age 14 onwards and don’t usually carry any cash.
I’ll NEVER use ‘fantastic plastic’ for my general spending & food, and I mean NEVER! I only use cash, and only ever will.
I’ve recently read a post on YLC that NAB branches are opening on Saturday mornings to help those who prefer to bank the ‘old’ way – face-to-face. Why is this happening when all this ‘doom & gloom’ is going around where the ‘boffins’ are saying that we’ll only be able to use card in the future?
Even though my bank is based in Melbourne, I can still use face-to-face services at my local Westpac/St George branch. We have a branch of all of the Big 4 banks in Wagga, and there’s branches of many others here, too, mainly smaller banks/credit unions.
Just so long as businesses decide to ‘add’ a surcharge for payment by card to purchases, I’ll use cash. I understand that they are charged for accepting cards, but this charge ‘should be’ added to the cost of the goods/services they offer. If they give 2 prices – one for cash and one for card, then we consumers may think twice about paying by card, thereby using cash.
In my humble opinion CASH IS KING!
The sooner cash is gone the better. Bring an end to tradies doing GST avoidance cash I hand deals. Bring an end to all these older folks with endless envelopes stuffed full of $50 notes hidden around their house so Centrelink don’t know how much they’ve got. But making themselves prime targets for burglary in the process. Probably by the readies they pay in cash. Bring an end to all these older folks people who seem to have barrels of coins to pay for their coffee with.
Do you go to the markets? Need cash for most stall holders. They don’t earn enough to warrant the bank charges. How many older people do you know that stash cash at home? They might put cash away to pay for something instead of using a credit card.
I’m a Boomer and don’t even carry a wallet. All my payments are done on my phone and even my drivers license is on my phone. I haven’t been to a bank branch for over a decade. The sooner cash is taken out of the economy then the sooner we get to know where all the money is and the sooner we stop paying handouts to people that are hiding money. First cab off the rank is get rid of $100 notes. There are 400 million in circulation, so someone has them in a shoebox.
I always carry cash on me, and “go through a couple a hundred a week” !!!
I use it in Venues that charge a Surcharge for using Plastic !!!
I prefer to use my card but there are 2 things I have to pay cash for. One is for my weekly washing and the other my fortnightly shopping. I live in a Retirement Village and I think it’s ridiculous that for elderly people who are not sure about cards should be allowed to use cash
This move towards no cash can be dangerous. With the number of scams on the increase banks are being super vigilant. I had my bank account blocked last month due to a suspected fraudulent transaction. Even though I told the bank it was actually me who was trying to make the transaction it took them 10 days to unblock my account, during which time my mobile provider threatened to cut off my account due to the payment being blocked by the bank. I had no other means of payment for buying groceries, buying petrol etc and had to borrow some cash from my brother. This will only get worse if no cash at all is available.