The government’s new cash mandate for supermarkets and petrol stations is getting closer.
Based on the verified information I’ve gathered, here’s the complete feature article:
What’s happening: The Albanese Government has released exposure draft regulations requiring fuel and grocery retailers to accept cash for in-person transactions of $500 or less. Small businesses with aggregate turnover under $10 million are exempt, as are franchise arrangements with turnover under that threshold.
Why this matters: Cash use has fallen dramatically, from 70 per cent of consumer payments in 2007 to just 13 per cent in 2022, according to the Reserve Bank of Australia. Around 1.5 million Australians still rely on cash for over 80 per cent of their in-person payments.
Australia is moving closer to mandating cash acceptance for essential purchases, with the government releasing detailed draft regulations that show exactly how the policy will work and which businesses will be affected.
The draft regulations, drawn up after public consultation earlier this year, prescribe that the cash acceptance mandate for fuel and groceries shall be limited to in-person transactions of under $500.
Small business exemptions
The regulations include significant carve-outs for smaller operators. Small businesses with aggregate turnover of under $10 million, or if the business is part of a franchise arrangement where the franchise arrangement’s turnover is under $10 million, are exempted from the regulations.
The government plans to use the definition of ‘small business’ included in the Income Tax Assessment Act 1997. This means the majority of businesses by number are unlikely to be covered by the mandate.
Assistant Treasurer and Minister for Financial Services Daniel Mulino said: “We recognise that Australians are increasingly using digital payment methods, but there will be an ongoing place for cash in our society under the government. This is a balanced, practical, and sensible step to support cash users and give consideration to businesses.”
The regulations also include additional exemptions for larger retailers in specific circumstances. Supermarkets could skip the cash acceptance mandate if the ACCC finds “exceptional circumstances outside the retailer’s control” would prevent them from accepting cash, such as if natural disasters prevent the transportation of cash. Supermarkets could also dodge the mandate if the associated costs of cash acceptance “would pose a significant risk to the ongoing feasibility of the supermarket business”.
The penalty question
For businesses that are covered by the mandate, the stakes are high. Businesses covered by the proposed mandate could face civil penalties for not accepting cash, with those penalties amounting to 600 penalty units, the equivalent of $198,000 as of October 2025.
The policy is designed to address a dramatic shift in payment behaviour. Cash was used in 70 per cent of consumer payments in 2007, falling to 13 per cent in 2022, according to the Reserve Bank of Australia.
Despite this decline, cash remains critical for a significant portion of the population. Around 1.5 million Australians still rely on cash for over 80 per cent of their in-person payments, with higher usage in regional areas.
COTA Australia Chief Executive Officer Patricia Sparrow emphasised the importance of the mandate for older Australians. She said: “For many older Australians, cash is a cornerstone of financial independence, not just a payment tool. There is a myriad of very valid reasons why people need to and prefer to pay with cash, including privacy and security concerns.”
Sparrow noted that one in two Australians over 65 years and about 35 per cent of 50 to 65 year olds report that they use cash on a regular basis.
What happens next
The Government is inviting submissions on the exposure draft regulations, with consultation closing on 31 October 2025.
The Government will review the mandate after three years to ensure it is functioning as intended, considering whether the mandate should be expanded, its impact on businesses, and any developments in cash distribution and access.
The Council of Financial Regulators and the Australian Competition and Consumer Commission released a consultation paper in July with a series of proposals on regulating cash distribution.
For consumers who need to pay bills in cash, existing services remain available. Consumers already have the option to pay their bills, including utilities, phone bills and council rates, in cash at their local Australia Post outlet through Post Billpay on the current terms of this service.
The mandate represents a balancing act between supporting vulnerable consumers who depend on cash and minimising the compliance burden on businesses, particularly smaller operators who may find cash handling costly or difficult.
The Government invites submissions on the exposure draft regulations with consultation closing on 31 October 2025.
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