Changes needed as New Zealanders use less cash

  • By Zilla Efrat

There’s a need for deliberate changes to the cash system in New Zealand to keep it resilient and efficient.

That’s the opinion of the Reserve Bank of New Zealand after its latest survey found that nearly two-thirds of New Zealanders were using cash to pay for everyday things when surveyed late last year (2021), compared with nearly everyone in both 2017 and 2019.

“While the proportion of New Zealanders who appear to rely on cash remains steady at about six per cent, over the last six years there’s been a significant drop in those of us who sometimes pay with cash, from 96 to 63 per cent of those surveyed,” says head of money and cash Ian Woolford.

“As in previous years, these people are more likely to be older, poorer, living rurally, or Māori.

“Meanwhile, it is clear that having some cash stored away is increasingly important for many of us during times of uncertainty with the percentage of us doing so rising from 37 to 46 per cent from 2017 to 2021.”

Woolford says the RBNZ’s latest survey suggests cash users are finding it more difficult to find places to deposit cash, while ATMs and supermarkets are the main sources of withdrawals.

“Having cash available, accepted in-store and readily deposited are key to both well-functioning local economies and communities where everyone is included,” he says.

“Closing bank branches, fewer ATMs, and reduced or removed cash services offered by banks contribute to falling use and difficulties.”

Woolford says the RBNZ is consulting on ways to improve the cash system. It published a cash system redesign consultation paper in November and the deadline for submissions is today.