Cashless society not a reality with hopeless internet service
With the release of the New Payments Platform (NPP) due later this year, commercial spectators are predicting Australia could be a cashless society by the year 2020 with the introduction of the instantaneous money transfers.
The NPP is new infrastructure for Australia's low-value payments. It will provide businesses and consumers with a fast, versatile, data-rich payments system for making their everyday payments.
But there is some discussion over the impact to businesses.
Currently, any big or small business running an eftpos machine are hit with a 1.3 – 1.5 per cent charge on the transactions. Though larger companies can absorb the additional expense, smaller businesses can run up to an additional $10,000 in transaction fees.
Businesses will see benefits in saving in time and money on handling cash, depositing to banks and investing in physical security.
The Federal Government is projecting the transition will increase tax revenues by potentially billions of dollars.
The Australian Taxation Office has already begun a compliance crackdown on certain regions across Australia. The ATO projects $23 billion is lost to the ‘black economy’.
Hairdressers, cafes and catering industries are in the line of sight, as 14 per cent report significantly outside of the industry benchmark.
The compliance initiative is aimed to educate and level the playing field to ensure all businesses are paying their fair share.
As transfers are set to become simple, swift and easy, banks should review their charges levied to businesses soon, as businesses will be forced into a corner where the option will be to lose thousands of dollars or pass along the burden to consumers, all at the cost of convenience.
Meanwhile, government is set to reclaim millions, if not billions, of dollars in lost revenue.
What is more concerning however is that to be able to move to a cashless, intangible economy businesses need access a reliant infrastructure to utilise these services.
Yvonne Tulley, of the Chamber of Commerce Gulf of Carpentaria, raised an issue affecting the North Queensland in relation to the internet.
The region has only recently been upgraded to ADSL 2, however connectivity and speeds remain unreliable due to a fault in the transmission tower.
Local businesses in the area are concerned with an influx of tourists in the winter months the system will not be able to handle the increased internet traffic, crashing the network, affecting eftpos machines.
Without a functioning and reliable internet, small businesses and residents cannot be expected to move to a ‘cash-less’ society until all members of our society have access to the services South-East Queenslanders receive and expect.
The future of a ‘cash free’ Australia will not be a reality until the Australian internet network is brought up to speed, for everyone.