These days it’s more common to tap a bank card or phone than it is to rummage through your wallet to pay with notes and coins. But as digital transactions dominate, many people are wondering whether businesses can refuse cash payments.
In January this year, the Federal Government introduced a new cash mandate compelling some businesses to accept cash payments.
Under the Cash Acceptance Industry Codes, supermarkets and certain petrol stations must accept cash for in-person payments between 7am and 9pm, unless the purchase is for more than $500.
The cash acceptance rules do not apply to:
- any other industries
- small businesses with an annual turnover of less than $10 million
- fuel retail sites that don't regularly sell unleaded petrol.
Some people assume that because cash is legal tender, businesses must accept it. However, the law is a little more complex.
Outside of the cash acceptance mandate, businesses can choose the type of payment methods they accept, including refusing cash. Businesses are allowed to set these conditions as part of the terms of sale, provided customers are clearly informed before you make a purchase.
For example, if not accepting cash payments, a business may display a clearly visible sign at the entrance or checkout, or staff may advise customers that the business does not accept cash payments.
Some consumers prefer to use cash because it helps them avoid card surcharges. While businesses can charge a surcharge for card payments under the Australian Consumer Law, the fee must reflect the actual cost of processing the payment, such as bank or terminal fees. Businesses must be able to justify any surcharge they charge.
It’s also worth remembering that accepting cash comes with costs for businesses, including staff time, cash handling, and banking expenses.
If you prefer to pay your utility bills, council rates, and phone bills with cash, you can still do so by using Post Billpay, a service available at Australia Post outlets.
Ultimately, buying goods or services is an agreement between you and the seller. You do not have to agree to make the purchase if the payment methods aren’t acceptable to you. However, unless the business is covered by the cash acceptance mandate, they can legally refuse cash so long as they have made this clear before the sale.
The Australian Competition and Consumer Commission is responsible for enforcing compliance with the Cash Acceptance Industry Codes. If you believe a business is breaching the rules, try to raise the issue with them first. If the matter can’t be resolved or you need further advice, contact Consumer Protection on 1300 30 40 54.