Cash Supports Inclusion and Wellbeing in New Zealand
At an event debating trends likely to influence the future of payments in New Zealand, cash was described as ‘an accessible form of payment’ valued for its contribution to ‘inclusion and wellbeing across society’.
Speaking at The Point 2022 conference in Auckland, Karen Silk, Assistant Governor of the Reserve Bank of New Zealand (RBNZ), noted that the present period of ‘substantive change’ offered enormous economic opportunities but ‘potentially greater risk’ if those opportunities were not effectively embraced.
Discussing the role of cash against this backdrop, she described it as ‘a value anchor for private money and for the financial system and economy more generally’. People can trust its value, and upon this trust monetary policy can be built ‘to maintain price stability and support maximum sustainable employment’. For the New Zealand economy, this permits the development of policy that benefits the nation, ‘rather than merely importing monetary policy decisions from other economies’.
She also highlighted another vital role played by cash, which is to serve as a form of payment accessible to all, regardless of age or social status. For those who are unwilling or unable to utilise digital payments, and for situations in which digital payments are unavailable—for example due to a power or internet outage—cash remains an essential payment option.
Many regard cash as the most dependable form of money, particularly during a natural disaster or even less traumatic outages (and we all have collective experiences that bears this out). Cash provides choice, autonomy, and agency for all, and for some it is the only form of money they have or can use.
In response to RBNZ research that ‘reaffirms New Zealanders value cash, even the many who don’t use it regularly’, the bank is developing a bundle of policy proposals designs to support access to and acceptance of cash. Silk stated these could include support for merchants in the form of remuneration for cash out services and facilitation of frequent and affordable cash delivery and collection.
The Reserve Bank remains committed to ensuring cash as one form of central bank money is available to New Zealanders for as long as people value and use it.