Massive payment shift pushes millions toward cashless society
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As the use of physical currency declines, a significant financial shift is on the horizon, bringing changes that could reshape everyday transactions.
A newly announced policy is set to accelerate the move toward a cashless society, affecting countless individuals.
But how will this transition unfold, and what should people expect in the evolving landscape?
The 2025 Federal Budget, announced with much anticipation, has targeted what many consumers have long considered a thorn in their side:
The 'unfair' card surcharges. In a move met with relief and curiosity, the government has declared its intention to ban debit card surcharges, subject to further work by the Reserve Bank of Australia (RBA) and implement safeguards to protect small businesses and consumers.
This decision follows a public outcry against excessive surcharges, with one particularly disgruntled Aussie, McLean Roche, penning a 55-page letter to the government.
Roche's submission, fueled by meticulous research and palpable frustration, highlighted the burden of surcharges on everyday transactions, from a family brunch that saw a $101 surcharge to a Qantas airfare that incurred a 69 per cent increase due to surcharges.
The RBA's review of merchant card payment costs and surcharging, which invited public submissions last year, has influenced the government's stance.
Over 100 submissions were received, and the message was clear: Australians are fed up with being nickel-and-dimed at every turn.
But it's not just about the surcharges. The budget also brings good news for those in regional areas, with the government securing commitments from major banks to maintain over 800 branches in regional and remote Australia until at least 31 July 2027.
Additionally, there's a boost in investment in Australia Post's Bank@Post service, which will ensure greater access and choice for bank customers in approximately 1,800 regional and remote communities.
As we inch closer to a cashless economy, it's essential to understand the implications of these changes.
The Competition and Consumer Act 2010 prohibits retailers from applying excessive card payment surcharges, and the Australian Competition and Consumer Commission (ACCC) is empowered to investigate and enforce this regulation.
However, the legality of weekend and public holiday surcharges in hospitality venues remains a contentious issue, though they are legal as long as customers are aware.
Adapting to this new reality requires support and education for seniors, who may be more accustomed to cash transactions.
Roche criticised authorities for failing to quantify the extent of surcharging and excessive fees, stating that the issue remains largely unaddressed.
According to their findings, illegal surcharges have cost Australians over $2 billion.
A November report confirmed that Australians have paid billions in unlawful merchant fees for federal government services over the past two decades.
The issue gained attention when the NSW government uncovered $144 million in illegal merchant fees across 92 million transactions since 2016, prompting a federal review.
Finance Minister Katy Gallagher announced that from 1 January 2025, new legislation will prevent the ATO and Services Australia from passing debit card surcharges onto consumers.
'This new legislation will provide the finance minister with the power to quickly and efficiently amend Commonwealth surcharging policies, including to stop Commonwealth agencies passing on debit card surcharges,' she explained.
However, additional fees imposed by businesses on weekends and public holidays remain under the ACCC’s jurisdiction for case-by-case investigations.
Banks and businesses must provide clear information and assistance to ensure everyone can transition smoothly to digital payments.
As we prepare for this change, staying informed and proactive is essential.
Check with your local bank about their services, especially if you're in a regional area.
Familiarise yourself with digital payment methods and understand your rights regarding surcharges.
And remember, if you encounter an excessive surcharge, you have the right to question it and seek redress.
How do you feel about the move towards a cashless society, and what steps are you taking to prepare for it? Share your thoughts and experiences with us in the comments below.
A newly announced policy is set to accelerate the move toward a cashless society, affecting countless individuals.
But how will this transition unfold, and what should people expect in the evolving landscape?
The 2025 Federal Budget, announced with much anticipation, has targeted what many consumers have long considered a thorn in their side:
The 'unfair' card surcharges. In a move met with relief and curiosity, the government has declared its intention to ban debit card surcharges, subject to further work by the Reserve Bank of Australia (RBA) and implement safeguards to protect small businesses and consumers.
This decision follows a public outcry against excessive surcharges, with one particularly disgruntled Aussie, McLean Roche, penning a 55-page letter to the government.
Excessive debit card surcharges targeted in 2025 budget to improve consumer deals. Credit: mihailomilovanovic / iStock
Roche's submission, fueled by meticulous research and palpable frustration, highlighted the burden of surcharges on everyday transactions, from a family brunch that saw a $101 surcharge to a Qantas airfare that incurred a 69 per cent increase due to surcharges.
The RBA's review of merchant card payment costs and surcharging, which invited public submissions last year, has influenced the government's stance.
Over 100 submissions were received, and the message was clear: Australians are fed up with being nickel-and-dimed at every turn.
But it's not just about the surcharges. The budget also brings good news for those in regional areas, with the government securing commitments from major banks to maintain over 800 branches in regional and remote Australia until at least 31 July 2027.
Additionally, there's a boost in investment in Australia Post's Bank@Post service, which will ensure greater access and choice for bank customers in approximately 1,800 regional and remote communities.
As we inch closer to a cashless economy, it's essential to understand the implications of these changes.
The Competition and Consumer Act 2010 prohibits retailers from applying excessive card payment surcharges, and the Australian Competition and Consumer Commission (ACCC) is empowered to investigate and enforce this regulation.
However, the legality of weekend and public holiday surcharges in hospitality venues remains a contentious issue, though they are legal as long as customers are aware.
Adapting to this new reality requires support and education for seniors, who may be more accustomed to cash transactions.
According to their findings, illegal surcharges have cost Australians over $2 billion.
A November report confirmed that Australians have paid billions in unlawful merchant fees for federal government services over the past two decades.
The issue gained attention when the NSW government uncovered $144 million in illegal merchant fees across 92 million transactions since 2016, prompting a federal review.
Finance Minister Katy Gallagher announced that from 1 January 2025, new legislation will prevent the ATO and Services Australia from passing debit card surcharges onto consumers.
'This new legislation will provide the finance minister with the power to quickly and efficiently amend Commonwealth surcharging policies, including to stop Commonwealth agencies passing on debit card surcharges,' she explained.
However, additional fees imposed by businesses on weekends and public holidays remain under the ACCC’s jurisdiction for case-by-case investigations.
Banks and businesses must provide clear information and assistance to ensure everyone can transition smoothly to digital payments.
As we prepare for this change, staying informed and proactive is essential.
Check with your local bank about their services, especially if you're in a regional area.
Familiarise yourself with digital payment methods and understand your rights regarding surcharges.
And remember, if you encounter an excessive surcharge, you have the right to question it and seek redress.
