How an Aussie pub’s ban on cash backfired spectacularly

A new brewpub opening in Western Australia this week caused a stir on social media after declaring it would not accept cash and would only accept card payments.

Froth Craft Brewery, just across North Beach in Perth's north, celebrated its opening on Thursday in preparation for the weekend rush, while the brewery's two other pubs in Exmouth and Bunbury were already very popular.

But potential customers on the Hey Perth Facebook group took issue with the refusal to accept cash and said they would avoid the venue.

“I won't support you if you can't accept cash,” said one Australian.

“Places that don't accept legal tender should be boycotted,” another agreed.

“Cash is key, you won't see me there and I live a few minutes away,” a third added.

“No cash… been to two locations like this and when the bank system keeps filling up so you can't buy anything they start whining about business being slow,” said yet another.

“We'll all laugh at you when the next internet banking or telecommunications outage happens,” another agreed.

A fifth said: 'No cash = no business from me.'

But some argued there was a good reason why the company had chosen not to have cash on the premises.

“No cash is more security for businesses and more security for customers,” one commenter argued.

“Less than 15 percent pay in cash,” another agrees.

“I really don't think the small number of people who refuse to go there because of that will impact their sales.”

Australia is shifting to a largely cashless society as digital payments soar and banks streamline their operations by dumping cash, but some argue the move leaves businesses and customers vulnerable to hacks or computer glitches.

Digital payments also incur fees when they are made, which wastes the savings of both businesses and customers, unlike cash which retains its fixed value.

The Craft Beach pub is the third in the Froth chain, with the Exmouth and Bunbury locations being very popular

The crew behind Froth recently received recognition from the Australian Hotels Association WA

RBA Governor Michele Bullock said at a conference this week that the share of consumer payments made with cash has fallen from 70 percent in 2007 to 13 percent last year.

While the federal government and central bank are committed to keeping cash as a secure payment option in Australia, RBA Governor Michele Bullock says its declining popularity poses a challenge.

The number of ATMs and bank branches where people can withdraw cash has already fallen, although Ms Bullock said the distances people had to travel to get cash “has changed little in recent years”.

“But this may not be the case in the future if the number of access points continues to decline,” she said at the AusPayNet Summit on Tuesday.

The RBA was keen to “maintain broad coverage of ATMs at reasonable prices, particularly in regional and remote areas” and was open to industry responses on ways the central bank's regulation could help, she said.

The economics of the distribution system, which includes companies that physically transfer banknotes, coins and credit cards from one place to another, is also under pressure.

The strained economics of this business model were one of the reasons why the consumer watchdog approved the merger of the two largest cash-in-transit companies, although Bullock said the sustainability of the model was still questionable.

Australia could consider alternative models such as a wholesale distribution scheme, she said.

Ny Breaking Australia has contacted Froth Craft Beach for comment.