Against a cashless society, Sweden enters the resistance

stockholm-442327_1280Is Sweden completely changing its mind about cash? For the past few years, the country had engaged in a war against cash and was to become one of the first cash-free nations on the planet. But voices were raised against it and now the access to cash could very well become a legal right in Sweden.

Sweden is one of these countries where bank cards are commonly used even for the smallest purchases. The amount of the Swedish crowns (national currency) in circulation has dropped significantly in the past six years; going from106 billion to just 80 billion today. As The Local reported, “cash transaction today represent no more than two percent of the value of all payments made in Sweden, (and that estimate) should drop to below 0.5 percent within the next five years.” (1)

Banks have played a big role in that process. Making access to cash more and more complicated for their citizens. Some stores were allowed not to accept cash by recent laws, even banks themselves stop to carry cash a while back.

Bjorn Ulvaeus, writer and singer for the group Abba became one of the strongest voices against cash, defending that paper money didn’t “make any sense in today’s world”. Ulvaeus’ revelation came after a robbery attempt when he started thinking that “if there wasn’t any paper money, there wouldn’t be any robbery”.

But when looking deeply, we realize that Sweden’s robbery cases have increased, not with physical robberies… but online. In fact, physical robberies have decreased in the past years and thieves seem to have found a new playground on the internet when the use of cash money and its transport is technically becoming safer and safer.

More and more Swedes therefore raised their voices against Ulvaeus and his theory. More and more tourists weren’t able to get around Sweden as their cards weren’t working and no buses would accept their cash money. Many small rural towns have seen their ATM disappeared in places where economy still depend greatly on cash money. Making cash money deposits is now cause for suspicion. And several citizens had to respond to justice after making cash deposits including after having received cash money… for a wedding (by foreign family members who weren’t aware of Sweden’s views on cash).

The main question that needs to be asked is about the connection between Sweden’s rapid shift towards “cashlessness” and the Swedish central bank’s descent (almost as rapid) into negative rates. The problem being that if Swedes aren’t able to withdraw any cash, the banks can charge for your deposits if the economy isn’t moving along fast enough. The idea is simple; you have to spend in order to “relaunch the economy” or else you will be charged a fee.

This makes savings much more complicated than it is today, doesn’t it? Removing cash would allow the banks to centrally plan the entire Swedish economy and make decisions for the citizens… But the citizens don’t agree with it.

The voices started to be raised for the communities or classes of people who would be greatly disadvantaged by the suppression of cash. The elderly population, not able to use new ways of online wallets and not accustomed to electronic payments would be the first to be marginalized. “It’s important to many older people to be able to use cash,” (2) Christina Tallberg, chairwoman of Swedish pensioners’ organization PRO, told Swedish Radio earlier this month.

Soon after, the Financial Markets Minister himself told stood up by telling Bloomberg that Swedish Banks shouldn’t expect “to get completely out of the business of handling cash” because citizens are still using it today “and will continue to do so”. Sweden is not yet a cashless society, and we don’t see that we will be in the foreseeable future either,” he said, adding that “some people have trouble using electronic payment methods, including those who are elderly or have disabilities, and we have to make sure the economy works for everyone, and that everyone can choose the payment method that they prefer.”

Even Stefan Ingves, Governor of the Riksbank stood against a cashless Sweden (and therefore against most of the Swedish banks) by suggesting that the ability to use cash should become an essential right and that the Government should pass law to force banks to provide cash services.

Ingves wrote a letter to the Ministry of Finance stating that the banks have reduced their cash handling services too fast resulting in a lack of cash services in less populated areas in particular, but for the public in general.

After Ingves, many major companies and CEOs followed the movement and backed up the Riksbank’s statement. Mike Lee, CEO of the ATMIA, says: This is a victory for common sense and for the future balance of the Swedish consumer economy and I’d like to congratulate the Swedish Riksbank for seeing through the mirage of anti-cash propaganda in the media to reveal the basic economic right of free citizens to choose their own payment methods at all times, whether cash or digital.” (3)

With more and more citizens and famous figures standing up for cash and against the so called “cashless society” promised by the banks and the Government. Cash became even more of a hot topic in Sweden. It should at least slow down the process of getting rid of cash but it could also very well turn out to change the opinion of many Swedes about their cash. The debate is bringing to light a phenomenon that many Swedes hadn’t seen in the past; cash means freedom and independence from banks. We will soon see if that’s the direction Sweden chooses to take.

  1. Swedes predict ‘death’ of cash in five years, The Local, March 4th 2016
  2. Sweden Minister says cashless society ‘not possible’; elderly disabled people blamed, Tyler Durden, Zero Hedge, March 16th 2016
  3. Swedish central bank calls halt on moves to a cashless economy, Finextra, March 18th 2016
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