The most important central banker of Australia predicts that very few people will still use cash within a decade – such as the most important money delivery company in the Nation is financially struggling.
Reserve Bank Governor Michele Bullock made the daring prediction of MPs in Canberra.
“We have to think that cash will probably be another 10 years and we have to find a way to move to a new system that means that the distribution of cash can be undertaken and viable,” she told the Huis van Delegates Economy Commission on Friday.
'You just have to look abroad to see that it really doesn't make it rebound.
“I don't think something will turn around – I think it is a long -term decline and the reason is that people find making electronic payments just much more efficient.”
Mrs. Bullock told Toowoomba-based liberal parliament member Garth Hamilton that there was no guarantee that Linfox Armaguard could reach a deal with the banks to continue to deliver cash after July, despite the fact that they had an almost monopoly at the cash delivery company.
“I am never confident in this gemroom at the moment,” she said.
“I think they should find a solution by June – if they don't, then we'll be in trouble.”
The most important central banker Michele Bullock in Australia predicts that very few people will still use cash within ten years
The Australian Banking Association, the most important bank members and Big Retails in June last year reached 12 months with Armaguard to deliver $ 50 million to subsidize its cash-in-transit activities.
But for cash deliveries to go beyond July, a new deal must be closed, where Armaguard would mark earlier, it would have difficulty to continue to deliver banknotes after 2026.
Only 13 percent of transactions are now being done in cash, show their own figures from the reserve bench.
“The digital side of things – I can't remember the last time I went to a bank,” said Mrs. Bullock.
“There is a large part of the population that has become pure digital, but there is still a part – they are often the more vulnerable people, people with a lower income, the regional people, they are those who are pressed through this.”
Mrs. Bullock said it was 'very challenging' that the fixed cost infrastructure was used to offer cash to retailers and the decreasing number of local bank branches.
“The difficulty with moving to a much more digital payment system and the banking system is that the element from person to person is increasingly becoming smaller,” she said.
'And there is a group of people who really want to use it, but they are just becoming a smaller and smaller group.
Only 13 percent of the transactions are now done in cash, showing their own figures from the reserve bench
“There is a real tension between effective maintaining a much higher costs than you maintain everyone else.”
The Reserve Bank Chief suggested that the vast majority of Australians who used tap-and-go-card and mobile wallet payments, cross the small minority of consumers who still used banknotes to pay for daily goods and services.
“The majority of your customers are in fact intersection that the much, much smaller group group,” said Mrs. Bullock.
“There is a very big challenge here – the money system is an example of it.”
The comments from Mrs Bullock Echo of the Commonwealth Bank Chief Executive Matt Comyn in 2023 in 2023 that tells a senate investigation about regional banking closures that those who do not use cash, those who do, subsidized.
“Transport and cash available in our vast country includes considerable costs for logistics and security,” he said.
The most important banks of Australia agreed last week to place a moratorium on regional bank closures until July 2027.
Treasurer Jim Chalmers introduced a money mandate in December that obliges companies to accept cash when selling essential items.
But the disappearance of local bank branches and ATMs is that it is increasingly difficult for Australians to gain access to cash.
A further consideration of figures from the Australian Prudential Regulation Authority showed 847 branches in regional and remote parts of the country had been closed since June 2017.
Nationally, 2,335 branches were closed in both the capitals and the regional areas for seven years – a dive of 41 percent.
