Record low ATM Withdrawals: A mere COVID-19 spill over or a Brimming New Saga

  • Jun 14, 2020 AEST
  • Team Kalkine
Record low ATM Withdrawals: A mere COVID-19 spill over or a Brimming New Saga


  • The social health and hygiene trends catalysed the technological momentum to bring down the use of paper money during COVID-19 scenario.
  • The complementary relationship between e-commerce and online payments boost the digital payment space.
  • The conservative consumer focus catapulted by job losses and recession is expected have spill over effect on the ATM withdrawals

Imposed social distancing which initially felt like choking the free spirit of the Australian society has somehow become the lifeline to dodge the detrimental perils attached to the pandemic. Meanwhile, as you placed a long list of orders on the e-cart of your grocery shopping app, unknowingly, you became a critical part of the paradigm shift. The moment might have been born out of the sheer need to fulfil the requirements of the daily essentials during clampdown, but consumers are getting accustomed to the new norm suggests spawning of the more current momentum.

ALSO READ: Significant Shift Towards e-retailing, Is Brick-and-Mortar Model at Perpetual Risk?

The latest figures which highlighted that ATM withdrawals in Australia dropped to 19-year rock-bottom, implied the Domino effect of the varying COVID-19 transformations on the monetary flow. The shifting passage towards the cashless payments has been only spurred by COVID-19, leading to the fall in the ATM withdrawals to $42.27 million in April. The period coincides the duration of lockdown, which saw stifled business activities and severe economic implications.

ATM Withdrawals in Australia hitting rock-bottom has sprang-forth many discussions that not only ponder on the change in the economic scenario but also sceptically weigh up the direction of the social change. The customers are particularly driving the new budding tendencies, which have resulted in toppling the direct cash payments. Let us look at the range of factors that together have culminated the decline in cash-withdrawals.

New Environment Impeding Cash Withdrawals

Health and Hygiene concerns

The escalated focus on the social distancing has propelled the consumers limit their social exposure to ward off the infection chances. Most of the efforts from both the customers and the businesses were channelled into minimising the physical contact as the country fought its battle against COVID-19 pandemic. The retail outlets and supermarkets did not accept cash as a payment method as it enhanced the chances of infection. Meanwhile, cautious consumers also avoided using the ATMs that could have increased the infection probability.


Consumer shirking away the cash transactions was also stimulated by the inconvenience associated with the use of cash. The paper money is not only difficult to carry but also consumes a significant amount of consumer’s time. The consumers have been provided an alternative to save their time which is spent on walking over to the ATMs and devoting their few minutes to the machine (Not to forget the time you spend at the cash counters as you count the money to be paid while the salesperson eagerly awaits looking over you for the next customer!!). An answer to our restlessness, an easy and time-saving alternative seems to be gaining momentum over the conventional paper cash.


The word ‘convenience’ has been brought to another level as the consumers have gotten habituated to the online shopping. The customary walk down the lane to get the retail store has been taken over by the online shopping applications that provide the consumers with an easy way out without the hassles surrounding the shopping in the brick and mortar stores. While the millennials were already delved deep into the particular new trend, the other generations also seem to join the bandwagon as the pandemic gripped the nation, spurring the online delivery. The online payment complementing the e-commerce purchases has fuelled digital transactions while lowering the utilisation of the cash.

Digital Payment apps

The payments applications offering a hassle-free platform to make secure payments lied at the heart of the digital transformations. The Buy-Now-Pay-Later apps further stepped up the game by allowing the instalment payments, mostly with no interest expense. The companies are vying to gain consumer attraction towards their digital platforms, and the intensified competition further bundled the payment opportunities for the customers.


Along with the social and technological trends, the change in the economic scenario fostered the decline in the transactions- not just cash payments but the total consumer expenditure. The period of low economic activity pulled GDP down by 0.3% and the headwinds against the business activities stemmed in thousands of job losses. Australian treasurer Mr Josh Frydenberg confirmed that the Australian economy is in recession, signifying that the people have gotten more conscious for ensuring the savings. The net effect of downfall in customer purchase is also evident on the ATM withdrawals.

Digital Players leveraging on the Transforming Scenario

As a range of elements, particularly during the lockdown clubbed to stifle the cash payments further, many companies witnessed surged business activities. The aurora around the emanating prospects has provided momentum to the digital transaction applications.

Zip Co Limited (ASX: Z1P)

The Buy-Now-Pay-Later company, Zip Co Limited (ASX: Z1P) recorded strong transactions during April 2020 with the shutdown in significant economy portion. The robust transaction volume resulted the increase in the YOY revenue by 81%. Building on a similar upbeat momentum, the company performed excellently in May as well. The increase in the monthly transaction volume by 63% (YoY) resulted in the YoY increase in revenue in May 2020 by 78%.

The company, meanwhile, continued its global expansion strategy and announced the acquisition of US BNPL player QuadPay in June.

As on 12 June, Z1P shares rose by over 356% in the past-three months to close at $6.3 per share

Afterpay Limited (ASX: APT)

The another Aussie BNPL provider, Afterpay Limited (ASX: APT) remained ahead of the curve with its strategic measures and digitally crafted solutions. The transformative digital fashion worked up to enhance the charm of the digital provider, which reached over 5 million active US customers on 20 May 2020. At the same time, WeChat and Internet value-added services provider Tencent Holdings Limited became a substantial holder in the business.

The substantial increase of 97% in underlying sales witnessed in Q3 FY20 compared to the previous corresponding period is indicative of the strong business performance. By the end of the trading session on 12 June 2020, APT stock gave 3-month return of over 117% to close at $51.860.

Sezzle Inc. (ASX: SZL)

The US-based alternative payment provider, Sezzle Inc. (ASX: SZL) appeared well-positioned in the e-commerce space. The Underlying Merchant Sales (UMS) shot up by 316% YoY in the same period while Sezzle’s 80% categories demonstrated a positive trend during the pandemic.

In April 2020, 114.4k active customers were added while the company gained 1,100 active merchants.

SZL closed at $3.050 on 12 June 2020 as its stock escalated by whopping 221% in the 3-month period.


The website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The article has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) or engage in any investment activity under discussion. We are neither licensed nor qualified to provide investment advice through this platform. All pictures are copyright to their respective owner(s). does not claim ownership of any of the pictures displayed on this website unless stated otherwise. Some of the images used on this website are taken from the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image.


There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.

Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.

As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report.

We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK