The head of the Reserve Bank issues a chilling warning that Australia will no longer pay money and what this will mean for Australians

Reserve Bank Governor Michele Bullock has warned that the decline in cash could leave consumers struggling to find ATMs and one day being charged for the privilege of using banknotes.

Only 13 percent of transactions are now made in cash, down from 70 percent in 2007, the Australian Payments Network Summit in Sydney was told on Tuesday morning.

Australia’s only cash-in-transit company has also indicated its business model is in trouble, meaning consumers could face charges for paying for goods and services with banknotes.

Ms Bullock was wary of the radical change as the vast majority of transactions are now made with cards on a tap-and-go basis, forcing banks to close hundreds of branches and ATMs every year.

“The declining use of cash also poses a challenge for offering cash services to consumers,” Ms Bullock said.

‘This is evidenced by the significant reduction in the number of cash access points in recent years, including ATMs and bank branches.

‘Despite this, the distance people have to travel to access money services has changed little in recent years.

“But this may not be the case in the future if the number of access points continues to decrease.”

Ms Bullock also warned that the cost of distributing cash could one day lead to customers being charged for the privilege of using notes, as is now the case for credit card transactions.

“The problem with cash has always been that companies don’t really understand the cost of cash in their business,” she told event moderator and former ABC news anchor Juanita Phillips.

“Right now they understand it a little better, but in the past they haven’t really done that. They have not internalized the processing costs.

“The challenge with cash is that there’s a really big community and public image associated with it.

“If you try to charge people to use cash – they’re willing to pay to get it out of an ATM – but if companies start charging people to use cash, I suspect there will be a very big response will come.’

But Ms. Bullock argued that consumers should ultimately pay to use cash to reflect the cost of cash distribution for businesses.

“That said, it is also true that as economists you want people to be confronted with prices for using certain services that reflect the costs of those services,” she said.

‘It is very difficult to actually enforce the payment of cash, but it will happen eventually: what will happen is what is happening right now: the costs will end up in the costs of the financial institutions that provide the services .’

During the last financial year, 718 ATMs were removed, according to data from the Australian Prudential Regulation Authority.

This happened like In the year to June, 424 bank branches were closed.

The number of branches has fallen by more than a third or 37 percent since June 2017.

Only 13 percent of transactions are now made in cash, down from 70 percent in 2007, the Australian Payments Network Summit was told in Sydney on Tuesday morning (stock photo shown)

The cost of transporting cash is so high that the Australian Competition and Consumer Commission this year approved the merger of Australia’s two largest cash-in-transit providers, Linfox Armaguard and Prosegur.

Ms. Bullock defended the merger but noted the new company Linfox Armaguard now ‘indicates that its CIT activities are still not sustainable’.

The decline in the use of cash has raised concerns about government surveillance of consumers and businesses, which goes beyond checking for potential tax evasion.

Some conspiracy theorists fear Australia could embrace China’s “social credit” system, under which individuals who upset the party are barred from making transactions or monitored.