Sweden: the disappearance of cash

Sweden: the disappearance of cash

Christophe Bourbier, Chairman of Limonetik

Payment by cash is no longer accepted at the Abba museum in Stockholm. Why? According to one member of the group, whose son’s flat was robbed, ready money makes easy prey for criminals.

Welcome to the land of electronic transaction!

In Sweden, cash payments represent only 3% of total transactions, compared to 9% across the Eurozone. From sports centres to bus tickets, from shops to services, the credit card or mobile phone are used everywhere. Two reasons are clearly alluded to by retailers who reject bank notes and coins: they are protected from burglaries and observe time savings on transactions. Indeed, electronic payments are processed noticeably quicker than cash payments. For banks, it is the same story. Some have already taken the step of stopping to accept payments in cash. Such is the case of Swedbank for whom cash payments accounted for only 5% of total transactions. They foresee a bleak future for cash and predict a disappearance before 2030. The figures speak for themselves: the number of bank robberies reduced from 110 in 2010 to 16 in 2011. But at the same time, the rate of cyber criminality increased seven fold between 2000 and 2011. A shift in criminal methods has clearly occurred.

The Scandinavian love affair with new technology

The Swedes, like their northern European neighbours, have taken easily to electronic systems of payment. Electronic payments start from a young age: a Swede may become a credit card holder from the age of just 13. However, it is increasingly difficult for old people to adapt to new technology. The change is too abrupt for them. Some of them are unable to memorise their PIN number and resort to writing it down… Not very secure! Credit cards mean a significant monthly cost due to the cost of possessing a card. Another disadvantage for the consumers is the total loss of anonymity because each transaction is automatically recorded. They are being watched. So the question arises, is the Swedish transition away from cash a way to make tax evasion and undeclared payments more difficult?

For whatever reason, Sweden, which was one of the first European countries to introduce bank notes in the 17th Century, may become one of the first countries to say goodbye to them. That could spell the beginning of the end for the bank note. For the time being the EU remains notably silent on the matter.