Australia at Risk of Losing Cash Services
Apr 3, 2023
One of Australia’s largest banks has announced service cuts including some of its branches no longer providing cash withdrawals. Critics warn the risks of sidelining cash include reducing resilience to natural disasters and cyberattacks, and economic exclusion of people who cannot or prefer not to use cashless payments.
ANZ Bank has stated ‘a small number’ of its branches in Victoria will halt cash-based services and instead ask customers to use ATMs. Immediate concerns have been raised as ATMs have seen significant reductions in recent years, with some 6,000 remaining of the 14,000 available in 2017, and the number of bank branches 30 percent down over the same period.
A similar plan announced in Ireland last year by Allied Irish Banks was reversed following strong, widespread outrage reaching as high as Prime Minister Micheál Martin. AIB agreed to retain cash services at all of its branches, ‘recognising the customer and public unease’ their proposal had caused. It remains to be seen whether Australia will follow suit, or allow the reduction of services to go ahead.
While ANZ says its customers are increasingly moving to online banking, the latest figures from the Reserve Bank of Australia show around 25 percent of people used cash for their most recent in-person transaction, with many preferring it for lower-value transactions.
Cyber security expert Ben Britton points out the resilience risks of a cashless economy, given any interruption to the electrical network or internet would render payments impossible. Brief outages are largely an inconvenience, and regularly seen, with recent examples including South Korea and Canada. Prolonged outages, which could result from a natural disaster or cyber attacks, may prove more problematic, with people unable to transact—and thus cover the cost of essentials such as food, fuel and shelter—for days at a time.
The entire system is dependent on an internet connection to work, so if there’s any interruption… people will not be able to make any payments. If there was a major cyber attack, if there was a vulnerability… and it was exploited, then they could potentially shut down every [electronic payment] terminal across the entire country.
This wide-scale risk comes in addition to higher personal risk of experiencing fraud when making cashless payments. Also, as well as reducing everyone’s payment choice, sidelining cash excludes individuals who may not be willing or able to access cashless options, including the very young and old, and people on low or irregular incomes.