According to the Inside Retail Australian Retail Outlook 2018 report, Australian consumers are now relying less on cash when they shop, preferring to use debit ocredit cards and smartphones. rsz istock 626008476 1

Outside of gambling and illegal activities, cash use is declining. China and India are among many countries phasing out the use of cash, with Sweden leading the charge as it aims to become a cashless society by 2030. 

While Australians still use cash, a decline is also evident. A 2016 report from the Reserve Bank of Australia revealed that cash was used for only 37 per cent of payments, down from 47 per cent in 2013. Debit and credit cards are the preferred payment method for Australian consumers (52 per cent in 2016).

As paper and metal fall from favour, as plastic may some day, new payment platforms are pointing the way of the future. Here are some of the main players: 


Android Pay and Apple Pay are two of the most popular payment platforms that let consumers buy items in stores, through selected apps and on websites using only their smartphone, and offering quicker processing times than credit/ debit cards. ANZ has just extended Apple Pay to 1.6 million Australian users, meaning shoppers can make Eftpos purchases via their Apple Watch or iPhone.


Even layby has had a technological makeover. AfterPay, a Sydney-based retail payments startup, lets consumers pay later for purchases through four equal fortnightly instalments. Since launching in 2014, AfterPay has grown from 1000 customers to more than half a million, and is offered by 3100 retailers around Australia.


Amazon’s own version of a payment platform, Amazon Pay, is used in more than 170 countries. It has now taken things one step further with its checkout-free beta store, Amazon Go. Customers simply grab what they want and go – no swiping, plugging or tapping. All that is needed is the app, which helps location-based technology in the store identify which products have been taken. The customer’s credit card is automatically charged.


While Alibaba has its own payment platform, it is starting to even regard digital wallets as mundane. It is now trialling the world’s first “smile to pay” concept using facial recognition technology at a KFC in Hangzhou, China. It takes just one to two seconds to identify a face, followed by secondary verification by the customer entering a mobile number. The common denominator for all this disruption is undoubtedly the smartphone. China’s adoption of mobile payment technology is staggering, with 469 million users (the population of the US is 326 million), the result of “technological leapfrogging”.


Despite the cautious adoption of these technologies in Australia and other developed countries, an adverse effect of the Eftpos infrastructure, new research by PayPal shows an opportunity for local retailers: 72 per cent of Australians now use a mobile device to shop, with 48 per cent making a purchase weekly, up from 12 per cent in 2016.

Despite this uplift in use, 36 per cent of businesses still believe their customers don’t want to buy via their smartphone. This disconnect highlights a chance for retailers to differentiate themselves by further integrating mobile payment technology in their websites, apps and even physical stores.

For further information please download the Inside Retail Australian Outlook 2018 report.