The nation’s central bank has been busy designing and printing a new $100 bill in anticipation of getting them into public wallets, bringing to a close a banknote redesign program decades in the making.
But the rollout of a redesigned hundred dollar bill -- the last in the series of next generation notes -- comes as the COVID-19 pandemic accelerates the downfall of cash and the public embraces newer payment technologies, according to the nation’s central bank.
New cash for an economy going cashless
About 400 million new $100 notes will be released into circulation from October 29. The Reserve Bank of Australia (RBA) has been printing the notes in preparation since the middle of last year.
Governor Philip Lowe described the release as a big logistical exercise and said it will take time for the new notes to become widely available.
“Australians should feel proud of our banknotes,” he said, at the time of the unveiling. “They are innovative and contain world-leading security features that keep the banknotes secure.”
The RBA planned the new line of banknotes to keep forgery rates low in a project first started in 2007. The redesigned $100 bill features a clear top-to-bottom window that has a number of security elements including a flying owl and a reversing number ‘100’.
Like the other banknotes in the series, the redesigned $100 bill also has a ‘tactile’ feature to help the vision impaired distinguish between different denominations.
The bill continues to honour Sir John Monash, an engineer, soldier and civic leader; and Dame Nellie Melba, a renowned soprano who performed in Australia, Europe and the USA.
It replaces a banknote introduced as part of a series in 1992; however, the old banknote can still be used to make purchases.
In the next 25 years, will cash still be around?
When the RBA first conducted its Consumer Payment Method survey in 2007, 69 per cent of people used cash to routinely make payments. But that number has dropped in the last dozen years to just 27 per cent -- and experts expect the fall to only hasten.
The RBA survey -- conducted every three years and documenting about 1100 people’s weekly payment habits -- offers an insight into the declining popularity of cash. The most recent was conducted in October and November 2019, preceding the coronavirus pandemic.
“Australians are continuing to switch to electronic payment methods in preference to cash for their day-to-day transactions,” RBA authors James Caddy, Luc Delaney and Chay Fisher said.
“Debit cards were the most frequently used means of payment in 2019, overtaking cash as the single most commonly used payment method for the first time.”
Overall, debit and credit cards accounted for 63 per cent of payments in 2019, representing an 11 per cent increase since the last report three years earlier.
And the arrival of the coronavirus pandemic is likely to have widened the gap between cash and card, the RBA said.
“More recently, the switch to electronic payment methods is likely to have accelerated as a result of consumer and merchant responses to COVID-19,” the authors said.
“... ATM withdrawals fell by 49 per cent and 38 per cent respectively from February to April 2020,” before somewhat rebounding in May and June.
There was one banknote that increased in popularity due to the pandemic.
“The role of cash as a precautionary store of wealth in times of uncertainty has been evident during the COVID-19 pandemic,” the RBA authors said, “where there was a significant increase in demand for high-denomination banknotes," such as $100 bills.