In Australia, the era of paper checks is gradually coming to an end.
On Wednesday, June 7, the Australian Government published a report officially stating the intention of this country to phase out the practice of using paper checks. This initiative will be implemented over the next few years. This decision was made by the Australian government against the background of an accelerated transition to digital payments in many countries of the world.
The government report also indicates that the country’s leadership intends to focus on eliminating legislative and other obstacles that hinder the process of abandoning the use of paper checks by the end of 2028. The year 2030 is indicated as the deadline for the final completion of the practice of applying the system of standard checks.
The report also contains information that according to the results of the last 10 years in Australia, the number of paper checks has decreased by almost 90% and currently accounts for 0.2% of the volume of non-cash retail payments in the country.
The dynamics of the use of cash also show a sharp decline, their share in the total structure of payment transactions by the end of 2022 amounted to 17%. In 2019, this figure was 27%. At the same time, the report notes that the amount of cash in circulation is increasing. This means that the majority of Australians continue to perceive cash as a way of storing value in case of unforeseen circumstances.
The report also states the fact that the process of digitalization of Australia’s payment system continues and is on an increasing scale. Against the background of a high level of trust in cash, there is a tendency for users to choose contactless transactions and groundbreaking technologies in the financial sector.
Card payments in Australia account for about 75% of non-cash retail payments. The remaining quarter of these financial operations accounts for mobile wallets.
The report indicates that the number of online debit and credit payments in Australia has also increased over the past decade. This trend has intensified during the coronavirus pandemic and continues to persist to this day.
The media reports that Australian Finance Minister Jim Chalmers will give a speech this week in which he will claim that 98% of personal checks and 100% of checks used for institutional and commercial purposes can be serviced via the Internet or mobile banking.
Consumers have already begun to get used to seamless digital capabilities when shopping, banking, and other everyday activities. Interest inappropriate technological solutions are observed in all age groups, which is of the greatest importance among young people. In the USA, 38% of millennials made payments using mobile wallets in May 2023. Among Generation X and baby boomers, this figure is 31% and 22%, respectively.
As we have reported earlier, Reserve Bank of Australia Tests CBDC Use Cases in Pilot.