Cash withdrawals continue to fall
The Reserve Bank of Australia's (RBA) recent figures have revealed a steady decline in the number of withdrawals at ATMs.
This trend coincides with the growing popularity of new payment options such as tap-and-go technologies, Paypass and PayWave, smartcards, and even key fobs, in addition to less recent developments like EFTPOS and online banking.
ATMs (and cash) out of favour
Within three years of the Commonwealth Bank becoming the first financial institution to introduce contactless payments in Australia, ATM withdrawals began to fall.
ATM usage peaked at 70.6 million withdrawals throughout Australia in 2008, after more than doubling in the previous nine years (from 34.2 million in 1999). The latest data, released last week, has shown a 12.5% drop in ATM visits over the seven years since; this equates to about 10 million fewer withdrawals than in 2008.
The number of cash withdrawals for February 2015 hit the lowest levels since February 2003.
But EFTPOS transactions to avoid paying ATM fees have doubled in number over that same 12-year period, according to the Australian Retail Association.
The RBA figures also revealed that consumers are withdrawing smaller amounts from ATMs, as they use tap-and-go cards more often.
While there was a time when bank customers would get enough cash out to last until their next pay, changes in withdrawal habits have seen ATM cash transactions drop to a record-low average of $89.53.
Earlier, RBA research found that consumers were making fewer cash top-ups each week, dropping from an average of $182 to $138 over the past six years.
Tech takes the lead
Peter Evers, head of People’s Choice Credit Union, told News Corp his members have found their smartphones to be their preferred way of making payments, and one-third of all their transactions were made through contactless payments including Pay Wave.
Evers predicted future ATMs will identify customers through their fingerprint, voice or retina, without the need for contact with a card.
However, CHOICE has found that many consumers have been turned off tap-and-go cards, particularly as banks and other card issuers introduced Paywave or PayPass capability into new cards without giving cardholders a chance to opt out of the service.
Security remains a concern, as relatively low-cost purchases ($100 or less) can be made without a signature or a PIN.