The king is dead. Not King Charles – we’re referring to cash. And some Australians are being left behind and disadvantaged.
Managing day-to-day transactions without cash is convenient for many and certainly more profitable for financial institutions. And that profitability is driving institutions to fast track the world towards a cashless society.
But this cavalier attitude – with the ‘Big Four’ banks leading the charge – appears to pay little heed to the needs of Aussies still heavily reliant on cash. The majority of these are either older or rural-based Australians or both.
What’s the big problem with not using cash?
For most, it’s not a problem at all. Even most of us in our 50s have adapted to the transition from cash to card to smartphone. But some are uncomfortable with cashless technologies, yet have no alternative. The local bank they’ve been walking to once or twice a week for decades has closed. The bank’s ATM might have been removed – if not at the time of closure, soon after.
This has happened across many suburbs. Cash lovers may be lucky enough to be able to switch to another bank in their suburb. At worst, they can drive or take public transport to a bank in a suburb nearby.
For country Australians, that option doesn’t exist. Many rural towns have been left without a bank at all. For residents of those towns there is no nearby suburb. The nearest town with a bank or even an ATM could be an hour’s drive away.
The proportion of Australia’s population that falls into this category is admittedly small, but it is significant.
Swinburne University Adjunct Professor Steve Worthington says around 7 per cent used cash for the majority of transactions last year. “There are significant minorities in that 7 per cent,” he said. “Senior citizens who are not digitally native, then there’s also people in rural and regional areas.”
Prof. Worthington also highlighted another important factor. “We have well over two million people with either no or little access to the internet. How they’re supposed to shift away from using cash is beyond me.”
Are the banks coming to the party?
Not according to the latest figures from the Australian Prudential Regulation Authority (APRA). Figures published by APRA last week show the number of bank branches nationwide fell 11 per cent in 2021-22. Since 2018, there has been a 35 per cent reduction in branch numbers. That’s more than a third of bank branch closures in just four years.
The decline in ATM numbers has been even steeper. The number of ATMs fell by 11 per cent in the year to June. That’s similar to the rate of branch closures in the same period but the figure since 2018 is a whopping 55 per cent.
The ‘Big Four’ banks’ ‘cash unfriendly’ tactics were called into question earlier this year by the federal government’s Regional Banking Taskforce. But although some agreed to a temporary moratorium on branch closures, the banks appear committed to unabated branch closures.
Those closures will come with a rather nebulous commitment to providing ‘better support’ to the disadvantaged.
What form of support that would entail remains to be seen.
Have you lost your local bank branch and/or ATM? How has this affected you? Let us know via the comments section below.
Also read: Rate of bank closures surprises even those supposedly in the know