The Australian Government has announced a plan to modernise the nation’s payment system, striking a balance between embracing digital payments and ensuring inclusivity. While digital payment methods continue to grow, the government is taking steps to ensure cash remains an option for essential transactions and to phase out cheques in a gradual, considered manner.

Key Points of the Government’s Plan

  1. Cash Mandate for Essential Transactions
    Despite the rise of digital payments, cash remains vital for many Australians. Around 1.5 million people rely on cash for over 80% of their in-person transactions. To safeguard these individuals, the government plans to mandate the acceptance of cash for essential goods and services, such as groceries and fuel. This ensures that cash users remain active participants in the economy.
  2. Phasing Out Cheques by 2029
    The use of cheques has declined sharply, with a 90% drop over the past decade. In response, the government has outlined a timeline to phase out cheques entirely:
    1. Jun 2028: Final issuance of cheques.
    2. Sept 2029: Cheques will no longer be accepted.

Banks will play a pivotal role in helping cheque users transition to alternative payment methods, providing support to minimise disruption.

  • Inclusive Consultation Process
    The government intends to consult extensively with stakeholders, including small businesses, regional communities, and individuals, to develop a cash mandate that is practical and inclusive. This process aims to address concerns around privacy, digital security, and accessibility.

What Does This Mean for You?

For individuals and businesses that rely on cash or cheques, these changes may seem challenging. However, the government’s approach includes safeguards to ensure a smooth transition:

  • Cash Accessibility: Essential goods and services providers will continue to accept cash, ensuring participation in the economy for all.
  • Extended Timeline for Cheques: The phase-out period allows time to adapt, with banks providing guidance and support.

How You Can Prepare

  • Stay informed about the government’s plans and timelines.
  • Engage in the consultation process to voice concerns or offer feedback.
  • Explore digital payment options to stay ahead of the transition.

Next Steps

The shift towards a modernised payment system is significant, but with planning and preparation, businesses and individuals can adapt successfully. If you have any concerns or would like assistance navigating these changes, please reach out to our office for advice tailored to your situation.