Australian retailers are now required to keep accepting cash at exactly the moment it has become significantly more expensive to handle. The question is no longer whether to accept cash, but how to carry it at a sustainable cost.

For most of the past decade, the industry conversation about cash ran in a different direction entirely. Is cash dying? Should stores go cashless? That debate has largely been settled by regulation, and it was never especially useful for retailers anyway.

On one side, this means retailers no longer have the option of quietly stepping back from cash. Most of those I speak to accept that obligation willingly. Cash matters. It remains critical infrastructure for a significant part of the population, and it is a genuine financial inclusion issue. Around half of Australians still use cash at least once a week, and it continues to account for a meaningful share of transactions. Very few retailers want to be the reason someone can’t pay for their groceries.

On the other side, handling that cash has become considerably more expensive. Cash-in-transit costs have risen steeply as the market has narrowed, and the labour cost of handling notes manually, often several times over before they leave the store, sits on top of that. A guaranteed obligation on one hand and a rising cost on the other: that is the real challenge with cash today.

The debate has moved from acceptance to efficiency

If cash is staying, and it is, the practical question becomes how to bring the cost of handling it back under control. The debate has shifted from cash acceptance to cash efficiency, and that is a far better place for the industry to be, because efficiency is something retailers can actually do something about.

The cost most retailers under-count

When retailers model the cost of cash, they tend to count the obvious things: Collection fees, banking costs, the time spent counting a till. What often gets left out is risk.

Industry estimates commonly attribute around 85 per cent of retail shrink to staff, and it is worth being precise about what that figure actually covers. It spans both intentional and unintentional loss. Some of it is theft. A great deal of it is not. It is miscounts, reconciliation errors, notes recorded twice or not at all, and honest mistakes made by people doing a repetitive manual task at the end of a long shift.

The pattern is consistent: The more times cash is touched, counted and moved by hand, the more opportunities there are for something to go wrong. Every additional handling step is another point of potential error, another reconciliation to chase, and another moment where a staff member is carrying money across a shop floor or into a back office.

That last point deserves more attention than it usually gets. Manual cash handling is a safety issue as much as a cost issue. Reducing the number of times a person has to physically handle cash reduces both the error rate and the exposure of the people doing it.

Smarter handling, not less cash

By automating cash management at the point of sale and self-checkout, retailers can dramatically reduce the amount of manual intervention required. Notes are validated and secured at the point they are received, rather than being counted, recounted and moved by hand through the store.

This is where our partnership with Armaguard comes in. By bringing together Diebold Nixdorf’s in-store cash automation with Armaguard’s cash-in-transit network, retailers get a single, connected approach to managing cash from the moment it enters the store to the moment it reaches the bank. It reduces handling cost and complexity, lowers losses from counterfeit or unvalidated notes, and takes a meaningful safety risk off the shopfloor.

There is also a cash flow benefit that tends to surprise retailers when they first hear it. With automated cash management, funds can effectively become available to the business much sooner, rather than sitting idle in a store waiting on a collection cycle. For a multi-site retailer, cash that is working rather than waiting is not a marginal gain. It is capital that can be put back into the business faster.

Cash is part of the store, not separate from it

None of this works as well in isolation, and this is where I think the industry conversation is heading next.

Smarter cash handling is not a standalone fix to be bolted on to the front end. It is one part of a connected store, where checkout, AI, loss prevention and cash management operate together rather than as separate systems bought at separate times. Retailers I talk to are increasingly evaluating technology on how well it works with everything else, not on what it does on its own. Cash is no exception.

The problem is solvable

Cash is not the problem to be eliminated. It has an important place in Australian retail and in Australian life, and the regulatory settings now reflect that.

The cost and risk of handling cash is a different matter, and unlike the broader economics of cash-in-transit, it is something individual retailers can address directly. The retailers who move first will spend less, lose less, and give their teams a safer and less frustrating job. That is a problem worth solving, and it is solvable now.

Diebold Nixdorf’s research report, The Evolution of Self-Checkout in Australia, is available now. Download it to see what the research means for your business, or contact the Diebold Nixdorf Retail ANZ team to discuss smarter cash handling.

About the author: Kristie Longhurst is GM retail ANZ at Diebold Nixdorf.