Australians living overseas will need to adapt to a significant change in how they make payments to Centrelink. From December 19, foreign currency cheques and international money orders will no longer be accepted, marking a pivotal shift in Services Australia’s payment system.
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This move comes as part of a broader plan to phase out cheque usage across Australia within the next five years, aligning with the country’s transition toward more efficient, digital payment methods.
Who is Affected?
This change will primarily impact:
- Australians living overseas who pay or receive child support or spousal maintenance.
- Individuals repaying a Centrelink debt from abroad.
Electronic Payments: The New Standard
From now on, those making payments to Services Australia from overseas will need to use electronic payment methods for foreign currency transactions.
Services Australia confirmed:
“If you’re making a payment to us from overseas, you’ll now need to use an electronic payment method to send foreign currency.”
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What Remains Unchanged?
- Centrelink Payments to Recipients: If you’re receiving a payment from Centrelink, there are no changes to how your funds are deposited. However, opting for direct deposit over cheques remains the faster and more reliable choice.
- Domestic Cheques: Recipients can still request cheque payments, though they take significantly longer to process compared to electronic transfers.
Australia’s Plan to Phase Out Cheques
This latest adjustment is part of a national plan to phase out cheques entirely:
- Cheque Issuance Ends: By June 30, 2028, cheques will no longer be issued in Australia.
- Cheque Acceptance Ends: By September 30, 2029, businesses and services will stop accepting cheques altogether.
Why the Shift?
Cheque usage has been in rapid decline for decades:
- In the early 1980s, cheques made up 85% of all non-cash payments in Australia.
- Over the last decade, cheque usage has plummeted by 90%, with most Australians embracing digital payment methods.
Treasurer Jim Chalmers emphasized the need for a coordinated transition:
“The usage of cheques has declined by 90% in the last ten years. To manage this industry trend, the Government is acting to give customers and businesses the certainty and assistance they need to switch to other payment methods.”
Why Foreign Cheques Are Excluded from the Transition Plan
Foreign cheques operate under a different set of rules than domestic ones. Although some smaller financial institutions may still process them, they are not part of the government’s broader cheque phase-out plan.
What Banks Are Doing
Australian banks are already taking steps to phase out cheque books:
- ANZ, Commonwealth Bank, and NAB: Have stopped issuing cheque books for new customers in recent years.
- Westpac: Remains the only major bank still offering cheque books, though its policies may change as the 2029 deadline approaches.
What This Means for Centrelink Users Overseas
The shift to electronic payment methods is intended to improve efficiency, speed, and reliability. While this change may cause inconvenience for those accustomed to cheques, it reflects a global trend toward digitized financial systems.
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Key Takeaways
- Australians overseas must now use electronic methods for Centrelink payments.
- The phase-out of cheques in Australia will be complete by 2029.
- Faster, more secure electronic payment systems are becoming the norm.
As Treasurer Jim Chalmers highlighted,
“The government’s plan ensures cash and digital payments remain accessible while providing businesses and customers the tools to adapt to new systems.”
This change signals the end of an era for cheque-based transactions in Australia and a continued shift toward a fully digital financial landscape.
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