It continues to get worse. The Commonwealth Bank is forcing it's customers to switch to a Smart Saver A/c which has a $3 fee to withdraw your own money from a teller, from the Post Office or by phone. The fee is waved if you deposit $2,000 per month. As a pensioner, my pension is paid into my Smart Saver A/c by direct deposit. At $1177 per fortnight, this meets this requirement.
However, traders wanting to get change for their tills, or deposit their cash takings are charged a cash handling fee.
As I have posted before, you can get cash from an ATM, but only multiples of $10, $20 or $50. If you need a $5 note, you have to withdraw more, then find somewhere to change it. But bank ATMs are disappearing, and you get charged a fee to use a privately owned ATM.
Many banks are closing branches, particularly in regional areas.
https://www.msn.com/en-au/money/news/people-first-bank-s-devastating-move-leaves-aussies-with-four-hour-trip-to-visit-bank-branch/ar-AA1Uj1Ea
However Westpac are opening more regional branches.
People think that cash is legal currency and must be accepted, but that's not the case. Provided the store/cafe/etc. clearly indicate that they accept card only, it is lawful for them to refuse cash. KFC is one of the latest to go cashless - it's up to the franchisee.
https://www.moneymag.com.au/do-australian-businesses-have-to-accept-cash
Some of the reasons for going cashless are-
cost of supply - escort services etc.
cost of insurance
reducing the likelihood of holdups - staff injury, trauma, etc.
time and cost of counting cash and taking it to nightsafes etc. to deter breakins
proliferation of forged notes (larger denominations) confusing counter staff under pressure causing business losses.
In addition to the details in the link below, forged notes are usually 2 or 3 mm shorter than genuine notes.
https://www.banknotes.rba.gov.au/counterfeit-detection/counterfeit-detection-guide/
There are also some places that only accept cash - cards not accepted.