$100 notes will be around longer than you

The $100 note in your wallet will be around longer than you, and potentially your children.

The bright green polymer bill is expected to stay in circulation for 150 years. Picture: Supplied

The $100 note in your wallet will be around longer than you and, potentially, your children.

The central bank’s note issue department estimates the bills could stay in circulation for close to 150 years. The more common $50 notes, the Reserve Bank reckons, are less likely to be stashed away so have a shorter lifespan, as do their lower denomination cousins. Essentially, the more people use the bills the quicker they can be expected to degrade.

Still, the bright yellow bills should be around in 2050.

The old paper notes — in the case of $5, $10 and $20 bills — barely lasted half a year. The $50 paper bill had the longest life ­expectancy, at under seven years, while paper $100 notes had a much more active existence, as they typically expired after fewer than two years.

Australia was a pioneer in polymer currency, with the first full series of notes introduced ­between 1992 and 1996. The benefits extend beyond convenience and aesthetics. The new notes’ longevity has saved the RBA $1bn in printing costs, a ­recent research paper by Max Wakefield, Luc Delaney and Richard Finlay, from the central bank’s note issue department, ­estimates.

That said, the case for using cash at all could expire long ­before the physical bills. It is difficult to imagine Australians using something as primitive as physical currency in 20 years, let alone by 2170 when today’s crisp $100 note is due to die a natural death.

People have for decades speculated about the death of physical money, as RBA boss Philip Lowe noted in November.

“It is now easier than it has been to conceive of a world in which banknotes are used for relatively few payments; that cash ­becomes a niche payment instrument,” he said.

The advent of simply tapping cards, or mobile devices, to make even small payments has further eroded the need for petty cash.

Around the turn of the past decade, Australians went to an ATM, on average, about 40 times a year, against about 25 times a year now. At the start of the century, we made an average 100 electronic payments a year. Today, that number is 500.

Legislation aimed at limiting tax avoidance and fighting the black economy will further hasten the demise of the physical note.

Last year the government moved to outlaw businesses making and receiving cash payments above $10,000 through the ­Restrictions on the Use of Cash Bill, which came into effect January 1.

Yet even as we use less cash, the value of money in circulation is close to the highest in 50 years. For every Australian, there are about 30 $50 notes on issue, and 14 $100 bills.

Why so much right now?

The RBA boss speculated that historically low rates have something to do with it. Holding cash under your mattress has never cost so little, in terms of forgone interest. You’ll typically earn 1.25 per cent on $10,000 in a one-year bank term deposit — well below the rate of inflation.