New research has revealed a surprising way Australians continue to use cold, hard cash, despite a slump in the popularity of bank notes.
The value of notes in the country ballooned by 22 per cent, or $19 billion, during the coronavirus pandemic, according to the Reserve Bank of Australia's report, Understanding the Post-pandemic Demand for Australia's Banknotes.
Today demand for notes remains "close to its historical high", the RBA says, despite cash being used less for daily purchases.
READ MORE: Searches for Taylor Swift on X come up empty after explicit AI pictures go viral
While Aussies are reluctant to spend their cash, many continue to hoard it, the RBA research found.
Stashing away notes is commonly done for "store-of-wealth or precautionary motives", the central bank says.
From the notes in circulation during last June, about 55 per cent to 80 per cent were hoarded, after accounting for factors such as fire-damaged bank notes.
The value of the stashed cash was $56 billion to $81 billion, the report found.
"This share has grown since the onset of the pandemic by around five percentage points, which indicates that much of the increase in banknote demand over this period was for hoarding purposes," the RBA says.
About 9 per cent to 26 per cent of notes in current circulation are used for daily purchases.
READ MORE: Three US troops killed in drone attack in Jordan, dozens injured
The "shadow economy", which the RBA defines as concealing legal transactions to avoid tax, to pay for illegal goods and services or to store wealth generated by the sale of illegal goods and services, accounts for a seperate 7 per cent to 11 per cent of notes.
The study comes after finance experts have warned Australia's transition to a cashless society is inevitable and could happen by the end of the decade.
Major banks have also closed thousands of branches as customers are encouraged to take up online banking.
