I know this isn't very widespread yet - of the five main banks in New Zealand, I know that three use it. I imagine, however, that it won't be long until this is standard practice in the banking industry.
I barely use cash myself, and mostly see it as an inconvenience. I know for a fact that I'm not the only one who thinks so, and I believe that the majority of my countrymen agree with me. Why on earth would you want to carry round bits of metal or plastic that you never seem to be able to get rid of entirely, when one or two cards will provide you with the same benefits with greater convenience and security? If I lose my EFTPOS card, I call the bank, cancel it, and arrange a replacement. If I lose cash, that's it - it's gone.
Although there is always the risk of fraudulent activity of my cards (much, much higher on my credit card than my EFTPOS card), every bank in this country, and I would expect in the world, has an agreement with their customers that if the customer does not contribute directly to the fraud, they are not liable for any stolen funds. Again, if someone steals my card, I'm inconvenienced for a couple of days, but if someone steals cash it's gone forever. I know which I prefer.
Adding features does not necessarily increase functionality -- it just makes the manuals thicker.