Why the use of cash is rapidly declining
When was the last time you used cash to pay for something? Do you even have cash in your wallet right now?
The way we pay has drastically changed over the past few years with so many new options available, such as buy-now-pay-later and contactless payments.
According to the annual Global Payments Report, cash payments in Australia will amount to just two per cent of transactions by 2025.
The report also predicts that digital wallets that are readily available with just two clicks on a smartphone, will be the preferred method of payment in just two years. This will overtake the use of credit and debit cards.
About 40 per cent of transactions across the country are composed of debit cards, following closely with credit cards at 35 per cent, digital wallets sitting at 11 per cent, cash seven percent, and buy-now-pay-later options at a mere four per cent.
Thanks to Covid-19 and periods of lockdown, most Aussies opted out of using cash, with the Australian Banking Association reporting a decline in use of ATMs by 20 per cent.
"Covid-19 accelerated trends in our society and changed the way we live our lives. Working from home will forever be more prominent within the workforce, we have steered away from using cash and as a result are seeing an increase in card and technology payments and the existing trend of doing banking online instead of in a branch has only continued," ABA chief executive Anna Bligh told Nine News.
"As we have seen more people go away from using branches, it's no surprise to see banks invest in areas where customers prefer to bank, such as in their online platforms and apps.”
The ABA also showed that one in 10 Aussies regularly leaves their home without their wallet, while more than one in three use digital wallets weekly.
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