Individuals affected by this change will be required to switch to electronic payment methods to remit foreign currency. Pixabay
Australians living overseas will be banned from paying with foreign currency cheques or international money orders under a major overhaul of the Centrelink payments system this week.
The change is part of a broader move to phase out cheques over the next five years, starting December 19. Individuals affected by the change will be required to switch to electronic payment methods to remit foreign currencies.
Services Australia recommended in its October newsletter exploring alternative payment methods to ensure seamless transactions.
Why are foreign cheques being phased out?
The elimination of foreign cheques is part of a larger plan to transform Australia’s payments ecosystem into a fully digital model. The government aims to make cheques redundant by 2030, as their use has fallen by 90 per cent over the past decade.
The Guardian reported last year that the shift is driven by demand for faster, more secure and more affordable payment solutions, given that online or mobile banking can process 100% of institutional and commercial checks and 98% of personal checks.
“From 19 December 2024, Services Australia will no longer accept repayments of Centrelink debts by cheque or money order in a foreign currency,” the communication reads. “If you need to repay a Centrelink debt, you will now need to use the alternative repayment options outlined in your debt letter. There are no changes to Centrelink payment options.”
Pensioners can still choose to receive their Centrelink benefits by cheque, although this method may be less reliable and slower than direct deposit. Recipients of cheque payments may have to wait longer as postal delivery times can change and be delayed due to unexpected events.
The Australian Government has set a clear timeline for phasing out the use of cheques. Cheques will stop being issued on June 30, 2028, and will stop being accepted on September 30, 2029.
The use of cheques has dropped by 90 per cent over the past decade as more Australians turn to digital payments%.