Australians will continue getting bang for their buck with safeguards to ensure cash remains king but small businesses are calling for a blanket exemption.
Businesses such as supermarkets, pharmacies and petrol stations selling essential items will have to accept cash payments under a proposed federal government mandate set to come into place in 2026.
About 1.5 million Australians use cash for more than 80 per cent of in-person payments.
About 94 per cent of businesses accept cash, but this was down from 99 per cent before the COVID-19 pandemic, Treasurer Jim Chalmers said.
It gave people the peace of mind they had a backup to buy items they needed, Dr Chalmers said.
“We don’t want to see the medium and bigger-sized businesses vacate the field if they’re selling essentials,” he told reporters in Canberra on Monday.
“We’re prepared to be reasonable about it.”
There will be carve outs for small businesses and there won’t be a focus on penalties, Dr Chalmers said.
Cash played an important role and while flexibility was important, a mandatory approach for small businesses shouldn’t be applied, Australian Chamber of Commerce and Industry chief executive Andrew McKellar said.
“Small business is really struggling with a growing regulatory burden at the moment, it’s probably unfair to expect all small businesses will be able to meet this sort of mandate,” he said.
Small Business Organisations Australia chief executive Luke Achterstraat said cash remained a critical part of the economy with many people preferring to use cash “and rumours of the death of cash are greatly exaggerated”.
“To succeed, any mandating of the acceptance of cash also requires the proper distribution and access to cash, particularly in regional areas,” he said.
“Access to cash should be deemed essential.”
Asked about a proposal for a bank levy to promote branches staying open in regional Australia, Dr Chalmers said his department was “trying to maintain a decent level of access and services for Australians who live in the bush”.
“It’s no secret that the decline of banking services in the regions is a challenge for a lot of Australians,” he said.
But no decisions have been made about how services will be guaranteed, the treasurer said.
National Seniors Australia and the Council on the Ageing welcomed the cash announcement.
Opposition finance spokeswoman Jane Hume said people should be able to use cash but “inflicting more regulation and red tape on businesses large and small does have implications for the cost of goods and services”.
Dr Chalmers denied prices would increase.
Treasury will begin the consultation before the end of 2024 on which businesses supplying essential goods and services should be covered by the mandate.
The consultation will consider the needs of those who rely on cash, including people in regional areas and those unable to use digital payments, as well as the impact on small businesses.
Final details of the mandate will be announced in 2025.
Cheques are also being phased out by September 2029 and will stop being issued by June 2028.
