Major bank’s new cash rule for Aussies

SYDNEY, AUSTRALIA - NewsWire Photos JUNE 24, 2022: Westpac Bank building signage, George Street, Sydney CBD. Picture: NCA NewsWire / Damian Shaw
The changes will come into effect on August 20, 2023. Picture: NCA NewsWire / Damian Shaw

Westpac has unveiled major changes to how customers use their debit cards, enacting a $1000 default cash withdrawal limit amid dwindling levels of cash withdrawals across the country.

The major bank will also cap transaction limits at a default of $8000 when selecting a ‘credit’ payment — currently a customer’s limit when tapping, inserting or making online payments with a debit card is their available balance.

Customers will still be able to set different limits for cash withdrawals.

MELBOURNE, AUSTRALIA - NewsWire Photos, DECEMBER 7, 2022. General economic coverage from central Melbourne. Westpac in Swanston street. Picture: NCA NewsWire / David Crosling
The changes, coming into effect on August 20, include a default $1000 cash limit. Picture: NCA NewsWire / David Crosling

This comes after the Reserve Bank of Australia (RBA) found on June 15 that there had been a sharp decline in cash transactions across the country.

“Most Australians now use cash infrequently,” the RBA’s Cash Use and Attitudes in Australia June 2023 Bulletin read.

“Indeed, 72 per cent of Australians were classed as ‘low cash users’ in 2022, using cash for 20 per cent or less of their in-person transactions, compared with 50 per cent in 2019.”

The number of ‘high cash users’, Australians who use cash for 80 per cent or more of their in-person transactions, now constitute only seven per cent of the country’s population — half of what it was in 2019.

MELBOURNE, AUSTRALIA - NewsWire Photos, OCTOBER 5, 2022. Bank stock in Melbourne. Westpac Bank. Picture: NCA NewsWire/ David Crosling
Nearly three quarters of Aussies use cash for 20 per cent or less of their in-person transactions. Picture: NCA NewsWire/ David Crosling

US-based financial tech company FIS found Australians are among the lowest cash-users in the world, beaten out only by Norwegians.

In the survey of 40 countries Australia was found to have the lowest cash usage in the Asia Pacific region in 2022, with cash payments representing just six per cent of point-of-sale transactions.

This was followed by New Zealand at seven per cent, China at eight per cent and South Korea at 11 per cent, who have all widely embraced electronic payment systems.

Commonwealth Bank keycards have a withdrawal limit of $1000 which can be changed up to a ceiling of $2000, while ANZ and NAB have limits of $1000 and $2000 respectively.

Under current federal legislation, all business must submit a threshold transaction report (TTR) when providing a service that involves the transfer of $10,000, or the foreign currency equivalent.

TTRs are enforced by the government to help detect and disrupt criminal and terrorist activity.

Westpac customers will be able to change their debit card limits after August 20 on the Westpac App, online, over the phone or by visiting staff at a branch.