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The dash away from cash carried a ‘utopian’ vision for the Swedish economic landscape, where consumers would no longer be tied to the apparently messy and, at times, inconvenient restraints of notes and coins. Ahead of the curve, Sweden was set to become the world’s first cashless society. However, while many stores, restaurants and tourist attractions quickly closed the door on the acceptance of cash with ‘card only’ signs dotted around windows and till-points, the pace has sparked concern regarding its stability and impact on vulnerable groups within the community. What was once a dream that seemed imminent and innovative is now a nightmare that is restrictive and discriminative.
Recently, it has been rumored that the Swedish government is likely to grant a proposal which will force banks to keep offering cash to those customers who require it. The central bank proposed last year to make it mandatory for banks that provide checking accounts and have more than 70 billion kronor in deposits from the Swedish public to offer cash withdrawals and handle daily receipts. However, the proposed legislation has caused some criticism among the banks and other establishments. The Swedish Bankers’ Association has argued that making only a select number of banks responsible for providing access to cash could be in breach of European Union rules. Additionally, the competition authority and financial watchdog have stated, respectively, that it would distort competition as it only affects a few banks and that securing access to cash should be a responsibility of the state.
The Riksbank has argued that all banks should be forced to have cash – stating that the legislation doesn’t go far enough. Banks need to cater to customer needs and these changes need to happen sooner rather than later as cash is increasingly losing its hold within the Swedish community.
It is uncertain what the outcome of this proposed legislation will be - especially considering the government’s rejection of a plea to enforce cash handlings recent as June last year. What is certain, however, is that there are people in Sweden’s community who are struggling to cope without access to mobile phones or bank cards. There is also the additional worry regarding the possibility of a digital payment blackout and what this would mean for consumers.
It is clear, for CMS Analytics at least, that the proposed legislation securing access to cash is critical in ensuring everyone has equal opportunities in society, while also serving as a backup payment method during technological failures. Furthermore, Sweden’s woes will likely serve as a lesson to other countries who are considering making the move to cashless at pace.
Read more here: www.bloomberg.com.
