Independent researchers estimate Sweden will go cashless on the 24th of March 2023, although they haven’t given the exact time – a half-hearted piece of work!
The date is slightly tongue in cheek, but is based on the current rate of adoption of cashless technology in Sweden.
Currently Sweden is one of the leading countries in the world, if not the leading country, to move away from cash. Already, many small businesses will simply not accept cash.
Perhaps more surprising is the position of the UK. Depending on which report you read, we could be as high as third, but definitely in the top five. This estimate is based on three key measures. Now you must promise not to laugh when you read this.
1. Adoption of technology. We have embraced contactless technology, either on cards or smartphones.
2. The overall value of business done on cards has increased. 10 years ago it was £2 on cards to £1 in cash. Today it is £4 on cards to £1 in cash.
3. We have a high tech banking system (now you promised not to laugh!)
There is another side to Sweden’s advanced status. A downside, and it was one we would do well to consider.
The cashless society should be more secure and less open to fraud. But it will probably be easier for governments to tax us as we leave our digital footprint around the world. To some, this is the first step towards an Orwellian world!
But on a more basic level, what about those in society who don’t have easy access to technology or the banking system?
Even though Sweden has more experience of electronic banking than the UK, there is still concern that the elderly will struggle to cope with the new technology. They understand cash and find it easier to manage. The same could be said for migrants or the less well off. Until they can establish themselves properly, how will they gain access to the banking system to access their funds or pay for services?
The Swedes have also noticed that the switch to cashless is effecting tourists. They can’t use coins in parking meters and they can’t use cards on buses. The cashless revolution is not consistent and the apps are not always reliable. Maybe we should consider something like the Hong Kong Oyster card for tourists that can be used for basic spending as well as public transport.
Perhaps the most interesting developments in the cashless society will come from Asia. China has an application called WeChat Pay that is now expanding into Europe and in India they have an even more fundamental problem. Half the population doesn’t have any form of identification, so how do you create a typical banking system? The answer is a biometric database called Aadhaar which now contains the details of 95% of the population and in turn is being used to provide a digital proof of identity. This enables Indian citizens to open bank accounts and access a range of digital services.
One final thought, cash isn’t going without a fight. A report from the Bank of England shows that the number of people relying on cash transactions has risen from 2.2 million to 2.7 million in the last two years. In 2016 the value of notes in circulation rose by 10 percent, the biggest rise in 10 years.
“Reports of my death are grossly exaggerated?”