The Triple A Benefits of Cash

calendar iconNov 17, 2022


Cash offers a ‘Triple A of Attraction’: it is Accepted nearly everywhere, it requires no Authorisation and it is completely Anonymous. Steve Worthington, Professor at Australia’s Swinburne University of Technology, presents these benefits and poses the obvious question: ‘Why then should we deny access to cash and limit its acceptance?’

Writing for the Australia and New Zealand Banking Group, Worthington describes a recent International Monetary Fund article looking at the opportunities and risks of digital currencies, noting that a critical facet of the payment landscape is financial inclusion. Quoting a Bank for International Settlements paper analysing the subject, Worthington says ‘access to and use of cash are a “catalytic pillar” for financial inclusion’.

A wide variety of people are at risk of financial exclusion, from those experiencing poverty to individuals with disabilities, senior citizens or undocumented migrants. Another major group is people who live in remote, rural areas, and Worthington notes Australia alone has an estimated 2.5 million people in that category. Unfortunately, he also cites information from the Australian Payments Network that, as of June 2022, there were 25,168 ATMs across the country: the lowest in 16 years compared with a high of 32,879 in December 2016.

Worthington points to progress in the European Union, which has put cash at the forefront of a drive to improve financial inclusion with its Eurosystem Cash Strategy, designed to give citizens full payment choice by ensuring cash remains available and accepted. Similarly, the UK is preparing legislation to maintain good cash access across the nation, including its more remote regions.

Beyond financial inclusion, cash is gaining popularity as a store of value in uncertain times. Worthington cites data from the Reserve Bank of Australia that shows, at the end of August 2022, that some $102,400 million worth of banknotes were circulating, of which just under 94 percent were higher-value bills ($50 and $100) favoured for personal saving.

Whilst accepting cash is being used less in payment transactions, it is still attractive as a store of value. [It also] continues to have its own Triple A of attraction; it is Accepted nearly everywhere, it requires no Authorisation and it is Anonymous. Why then should we deny access to cash and limit its acceptance as a means of payment?
"Steve Worthington, Professor, Swinburne University of Technology
Last Updated: Nov 17, 2022