Cafes, bottle shops could be exempt from government’s cash mandate

Cafes, takeaways, bottleshops and hairdressers could avoid being hit by an incoming cash mandate, according to a Federal Government discussion paper fleshing out recently announced protections for cash.

The Albanese Government unveiled its plan to protect cash as a payment method last month after usage dropped off a cliff in recent years.

About 1.5 million Australians prefer using cash to digital payments, and in some remote parts of the vast continent, it is the only viable option.

Part of the plan includes mandating that businesses accept cash for “essential items”.

A Government discussion paper dropped on Friday offered some idea of what may qualify as essential.

Among those that made the essential list are supermarkets, pharmacies, dentists, GPs, hardware stores, insurers, pet stores, vets, service stations and mechanics.

The paper also looked at exemptions, including whether it would be appropriate to only mandate cash be accepted until 10pm for safety reasons, and punitive measures for businesses that fail to comply, arguing customers could be hit with a “cash surcharge” if there were no penalties.

One option included giving compliance powers to the consumer rights watchdog.

“Anti-avoidance measures could assist in preventing businesses from circumventing the cash acceptance mandate,” the paper said.

“Without these measures, businesses may find otherwise lawful ways to undermine the effectiveness of the mandate.”

France, which has also introduced a cash mandate, takes a hard line approach, making it illegal to refuse cash payments with very few exceptions, including issues with the cash itself, such as damage.

Another exemption is where there is a safety concern for the merchant, such as a shopkeeper working a nightshift.

France’s central bank has said that cash “guarantees that everyone has the freedom to choose how they wish to pay.”

Although, the discussion paper suggested a slightly softer approach was on the cards.

One option was to hand compliance over to the Australian consumer rights watchdog to figure out.

It considered limits on how customers can pay in cash and at what time they can do so, floating a window from 6am-10pm.

It also said caps on cash payments aimed to “reduce the burden on businesses by limiting the volume of cash transactions they must handle, while still ensuring that consumers can use cash for smaller, everyday purchases”.

Other developed economies that have introduced similar mandates include Spain, France, Denmark and Norway.

Norway was a world leader in transitioning to a cashless society, but its parliament passed laws mandating business continue accepting cash amid heightened security concerns from Russia.

Final details of the mandate will be announced in 2025. Subject to the outcomes of consultation, the mandate would commence from 1 January 2026.