Announcement date
14 December 2025
Link to announcement
Problem being addressed
Around 1.5 million Australians continue to rely on cash for 80 per cent or more of their in-person transactions. However, businesses are increasingly not accepting cash. This raises significant social and economic inclusion concerns for Australians who rely on cash for essential purchases. Among those likely to be most impacted are Australians living in regional communities, older Australians, First Nations peoples, culturally and linguistically diverse (CALD) communities, people living with disabilities and victim-survivors of family and domestic violence.
Currently no rules exist to require merchants to accept cash as a payment method. Without a mandate, there is no guarantee that Australians will be able to use cash to pay for their essential goods in the future.
Proposal
Three options were analysed in this IA:
- Option 1: Status quo – No mandate.
- Option 2: Targeted mandate – Apply to fuel and grocery retailers for in-person purchases of $500 or less, between 7am and 9pm, with exemptions for most small businesses.
- Option 3: Broader mandate – Apply to a wider range of non-discretionary retail businesses.
The targeted mandate in Option 2 provides the greatest net benefits to resolving the policy problem by maintaining access to essential goods for cash-dependent Australians, strengthening payment system resilience and avoiding future infrastructure costs.
Targeting the mandate to fuel and grocery retailers most effectively balances these consumer benefits while minimising costs and risks to businesses. This approach leverages existing cash-accepting infrastructure and avoids costly retrofitting later. Any broader mandate at this time will provide diminishing returns for more significant impacts on industry. Consultation showed strong support for fuel and grocery inclusion but no clear consensus on other categories.
Assessed Impact Analysis outcome
Adequate
Assessment comments
The quality of the analysis in the IA is Adequate. To be considered Good practice as per the Australian Government Guide to Policy Impact Analysis, the IA would have benefitted from further analysis, including further quantitative analysis of the likely costs and benefits.
Regulatory burden
For fuel retailing businesses which do not currently accept cash, the Treasury estimates that Option 2 will incur additional one-off costs of $5.8 million for the installation of cash accepting terminals and ongoing cash handling costs. For all in-scope businesses, the additional average annual ongoing cash handling costs from Option 2 are estimated to range from $14.2 million to $28.4 million.
Note: Information used in the decision making has been redacted for the public version of the IA. This information is classified Commercial-in-confidence or National Security or may refer to Confidential stakeholder submissions.