The RBA said the decision was made in consultation with the Federal Government which it said supported the change. Significantly, the change would not mean the image of King Charles III would be used as a replacement.

It follows the death of Queen Elizabeth last year.

The RBA said it would consult with indigenous people on the design of the new $5 note, but that it would take an unknown number of years to design and print.

“In the meantime, the current $5 banknote will continue to be issued,” the RBA said.

“It will be able to be used even after the new banknote is issued.”

Indigenous themes have been used before on Australian currency. The first $1 note, issued in 1966, had images of Aboriginal rock paintings and carvings, which were based on a bark painting by David Malangi Daymirringu. A $10 polymer note issued in 1988 also included Aboriginal contemporary art and the current $50 note features David Uniapon, a Ngarrindjeri man from South Australia.

King Charles’s image was expected to be used on Australian coins from later this year.

The late Queen’s image was expected to be replaced on British currency by the image of King Charles III. The Royal Mint has already released an official coin effigy of the new King and revised banknotes were likely to be in circulation in 2024.

Britain has also stopped issuing stamps with the late Queen’s image.

The Australian Republican Movement welcomed the change with chair Craig Foster saying it was an important symbolic step.

“Australia believes in meritocracy so the idea that someone should be on our currency by birthright is irreconcilable as is the notion that they should be our head of state by birthright,” Foster said.