Major Aussie bank goes cashless from today. Here's how it will affect customers (2024)

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Major Aussie bank goes cashless from today. Here's how it will affect customers? ›

Under the changes starting today, customers will still be able to withdraw cash from ATMs with their Macquarie

Experts believe Australia will become “functionally cashless” by 2030, due to the increased consumer preference for digital payments. Behind Baby Boomers, a recent survey found regional Aussies and those on lower-incomes were the most concerned about this shift.

Last year, Macquarie Bank announced a decision to overhaul its traditional cash and cheque services as part of a strategic pivot due to evolving customer preferences and the growing prevalence of digital banking solutions.

Cashless is a term used to describe a system where people rely entirely on electronic payments rather than paper money. Processing such transactions usually occur through channels, such as: Point of Sale systems (POS) Internet banking.

The US is moving toward cashless payments, with a substantial increase in the use of mobile wallet apps and contactless cards. A report from the Federal Reserve Bank of San Francisco found that payments made using cash accounted for just 18% of all US payments in 2022.

The FCS protects deposits up to a limit of $250,000 for account holders at each bank, building society and credit union incorporated in Australia. A bank, building society or credit union cannot operate in Australia without being licensed by the Australian Prudential Regulation Authority (APRA).

What Is Meant by a Run on the Bank? This happens when people try to withdraw all of their funds for fear of a bank collapse. When this is done simultaneously by many depositors, the bank can run out of cash, causing it to become insolvent.

It is Bank's policy to ask for the source of money (if you are depositing), or what the money will be used on (if you are withdrawing) some money on certain limit. It doesn't matter who you are, the Bank will ask you nonetheless, and they do some reporting to Authority as well.

Macquarie Bank customers will no longer be able to use cash at its branches from later this month as part of its transition to a fully digital model.

She estimates that Australia will enter into a cashless society by 2030, slightly later than Commonwealth Bank's prediction of 2026, and argues for government regulation of digital payment services to help navigate the transition.

What are the risks of a cashless society? ›

The downsides of going cashless include less privacy, greater exposure to hacking, technological dependency, magnifying economic inequality, and more.

Similar rates have been recorded across other Scandinavian nations, while Hong Kong predicts cash will account for only 1.6% of point-of-sale (POS) transactions by 2024. But despite this global shift away from tangible currency, the US isn't likely to transition officially any time soon.

Why Eliminate Cash? Cash can be used in criminal activities such as money laundering and tax evasion because it is difficult to trace. Digital transactions or electronic money create an audit trail for law enforcement and financial institutions and can aid governments in economic policymaking.

The elderly members of society are at particular risk, as they are often not confident using digital payment methods or online banking services.

Decreased Monetary Security

When you have cash in hand, you know it's safe from everything except direct robbery or physical destruction. But when your money is in digital form, it's vulnerable to hackers and system malfunctions.

A cashless future enabled by technology

We may not be a cashless society by 2060, much less by 2030. But the fact is we're closer to becoming a nearly cashless society every day. The transition from a mostly cash to nearly cashless society didn't happen overnight.

Macquarie Bank customers will be stopped from withdrawing and depositing cash or cheques at its branches around the country from this month. Australia's fifth largest bank revealed last year the rise of digital payment systems has resulted in them pivoting away from loads of in-person banking processes.

Money will be in digital format, just like credit cards, bank accounts and PayPal. But if you mean will the world remove currency altogether, then no.”

Legal tender laws: Australian banknotes and coins are legal tender throughout Australia. Generally, a business is obliged to accept cash for transactions, unless an alternative payment method is clearly specified before the transaction takes place (such as in online purchases).

Australian consumers have increasingly been using electronic payment methods in preference to cash for their transactions. The overall demand for cash in Australia, however, remains strong. There is ongoing demand for cash for non-transaction purposes, particularly as a store of wealth.