The Australian government is stepping up efforts to ensure cash remains a viable payment option for essential services, unveiling plans to mandate businesses to accept cash transactions by 2026. This move comes amid a broader strategy to phase out cheques, which have seen a sharp decline in usage over the past decade.

The proposal aims to safeguard cash-dependent Australians, particularly during emergencies like natural disasters or digital outages. Under the plan, businesses providing essential goods and services—such as groceries, fuel, banking, and healthcare—will be required to accept cash payments. However, small businesses may be exempt based on factors like size, location, and cash-handling capacity.

The Treasury is set to initiate consultations this year to define the scope of essential items and establish clear guidelines for the mandate. Major supermarkets, petrol stations, and healthcare providers are likely to fall under this legislation.

The move responds to growing concerns about the dwindling availability of cash options. Over the last five years, more than 6000 ATMs have disappeared across the country, and cashless payment systems have surged. Additionally, 200 bank branches were closed in the past financial year, further restricting access to physical currency.

Currently, businesses can choose their accepted payment methods, often declining cash or imposing surcharges on card payments. While excessive surcharges are already prohibited, the push for mandatory cash acceptance highlights the need for equitable payment options in a rapidly digitalising economy.

Treasurer Jim Chalmers has also urged banks to maintain support for cheque usage until its planned phase-out. By mid-2028, cheques will no longer be issued, and they’ll cease to be accepted by September 2029. With cheque usage plummeting by 90% over the last decade, they now account for just 0.2% of non-cash retail payments.

This dual approach—ensuring cash remains accessible while phasing out cheques—aims to balance innovation in payments with inclusivity for all Australians.