Yahoo Finance Cashless Australia: Optus outage ‘proof’ Australia could be ‘doomed’
Some Aussies say the Optus outage highlights that “cash is king”.
As the fallout from the Optus outage continues, frustrated Aussies have warned the situation is proof Australia will be “doomed” if it becomes a cashless society.
Businesses across the country were brought to a halt due to the major outage, with those relying on the Optus network unable to use their EFTPOS machines and forced to revert to cash-only payments.
The debate has raged in Australia recently about whether we as a nation should be protecting our right to cash, with some businesses like a NSW KFC ditching it, and big banks upping fees and revealing the huge financial toll of cash management as they defend moving away from the form of payment.
But today proved that many Australians were simply not ready to go cashless, strengthening arguments it would take a methodical approach and serious consultation before it could become a reality.
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People were left in the lurch when arriving at stores who had plastered signs that they would not be able to take card payments.
“The #Optus outage this morning is exactly why we cannot go cashless. When the phone's are down, how are people going to pay for stuff?” one person said.
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“Imagine having cashless [sic] in our country and having no internet access due to outage, we’re doomed,” another wrote.
“This Optus outage is proof that we are simply nowhere near ready for a cashless society. One major communications company going down, and half the country can't pay or process payments without cash,” another said.
Cash the ‘only reliable payment system’
Jason Bryce, the spokesperson for the Cash Welcome campaign, said he was left “stranded” by today's Optus outage.
“Luckily, I had a $10 note in my pocket but [the] coffee shop had no change so [it was a] $10 coffee and a walk home for me this morning,” Bryce told Yahoo Finance.
Bryce is urging the government to step in and ensure Australians have access to cash, which he sees as “the only reliable payment system”.
“This situation is getting serious. Our economy is becoming vulnerable and people are being left without the ability to make payments,” Bryce said.
“When cashless systems fail and all the local ATMs have been removed, a community is left fairly helpless.”
Last month, APRA confirmed 424 bank branches and 718 bank-owned ATMs had been shut down across Australia in the previous 12 months.
Australia’s systems are ‘fragile’
Dr Paul Gardner-Stephen, Flinders University adjunct senior lecturer and Shuttleworth Telecommunications Fellow, said it was only when communications services failed that Aussies were reminded of the “fragility” of our modern systems.
“In the past, the workaround was to use cash. But, following the COVID pandemic, many people have switched to using non-cash payment methods, whether cards or their digital equivalents on their phones,” Gardner-Stephen said.
“But all those methods rely on the mobile communications networks to function: The EFTPOS machines in most stores are connected via the mobile phone network, for example.”
Do Aussies support going cashless?
There are arguments to both sides about a cashless Australia.
Trends are showing Australians withdrawing and using cash for point of sale transactions is dropping, but there are many reasons people should still have the option to.
Vulnerable Aussies like the old, socioeconomically disadvantaged, or those living in rural areas are more likely to use cash and be disproportionately impacted if it was taken away.
A poll of Yahoo Finance audience members found 92 per cent of respondents would not support Australia going completely cashless.
There are still cash points available at most supermarkets and the some 20,000 ATMs around Australia, with about $100 billion in cash - or two billion notes floating around.
Experts say Australia is more likely to become “functionally cashless” as less people decide to use it, which means increasing costs to support a smaller segment of the community.
Businesses deciding to no longer take on those costs could accelerate the process, or government intervention.
“You could accelerate the process if the government said: ‘We are going to phase out the $100 bill by 2024, then the $50 note by 2025 and the $20 by 2026’,” Richard Holden, Professor of Economics at UNSW Business School, told Yahoo Finance said.
“By giving a timeframe for the transition, people would have time to prepare.”
What you need to know about the use of cash in Australia
Fewer people are using cash due to the convenience of paying with phones, watches and cards.
There isn’t a shortage of cash-withdrawal points, with around 20,000 ATMs plus supermarkets to collect from.
There’s about $100 billion in cash floating around Australia - or 2 billion notes
The government has not indicated cash will be taken out of circulation
The Big Four banks have all ruled out going cashless.
Average cash withdrawal has increased from $180 to $290.
RBA: ATM withdrawals dropped from 77.9 million in December 2008 to 29.7 million in June 2023.
Finder survey: 13 per cent of Aussies never use cash, 44 per cent use it once a week, and 42 per cent once a month or less.
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