Sweden is Well on its Way to Becoming the First Cashless Society in the World

Asking a Swede if they have change for a five will soon be like offering to pay for your coffee with a silver dollar.

Which is to say cash will soon be obsolete in Sweden.

“Cash is still an important means of payment in many countries’ markets, but that no longer applies here in Sweden,” says KTH Royal Institute of Technology researcher Niklas Arvidsson with amusing condescendence. “Our use of cash is small, and it’s decreasing rapidly.”

This is largely because Swedish banks are keen to be early adopters of advanced IT systems, which is complemented by a strong consumer tradition of welcoming electronic payment services. One of those services is Swish, a mobile payment app that’s widely accepted by banks across Sweden and Denmark. In fact, some bank branches in Sweden don’t even accept cash anymore. Those that do are required to ask customers to explain where the cash comes from as part of a crackdown on money laundering and terrorist financing, which obviously no one wants to deal with.

The next step will be for Swish to become the standard payment method for retail transactions and e-commerce, after which the country will undergo a full revolution of the banking system.

There are now more than 20% fewer Swedish crowns in circulation than there were six years ago, and only between 40 and 60 percent of that is actually in regular circulation.

In the meantime, the central bank and economists of Sweden are trying to reach a consensus about which financial instruments and methods of payment could potentially replace the country’s currency.

Looks like they’re giving Canada a run for their money