Cashing out? Why notes and coins may become a thing of the past in Sweden

At a public toilet in a shopping centre in Gothenburg, a struggle is taking place between old and new Sweden. Last year, the the shopping centre installed cash-free toilets, forcing customers to pay with their mobile phones – a process new to most.

“I was in a hurry, I really needed to go,” said Freda, 28, after a visit. “It was all a bit confusing, but I never carry cash, so I am just pleased I could get in.”

A succession of older customers turned away in bewilderment or disgust. “It’s just wrong,” said Tilda, 69.

Sweden is one of the most cash-free societies in the world. The proportion of cash payments in the retail sector fell from about 40% in 2010 to about 15% in 2016, according to Sweden’s central bank. Two-thirds of consumers say they completely manage without cash; just as many say they mostly use cards even for payments under 100 kronor (£9).

More than half the nation’s bank branches no longer take or issue cash. Many stores greet the shopper with notices that they no longer accept hard currency.

As a result, the total value of cash payments in the economy has fallen to less than 2% of GDP. “In the not-too-distant future, Sweden may become a society in which cash is no longer generally accepted,” the Swedish central bank has said.

Public facility for showering, washing and toilet in Trelleborg, Sweden with outdoor pay stations at every door
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 Public facility for showering, washing and toilet in Trelleborg, Sweden with outdoor pay stations at every door Photograph: Reimphoto/Getty Images

And now, even public conveniences are going digital. It could be said that for cash, the writing is on the toilet wall. CoinCode, a tech startup based in Uppsala, is endeavouring to give a whole new meaning to “spending a penny”.

Their battery-operated gadget is fixed to existing locks – you scan a quick response code on the toilet door or send a text message to the company and, in each case, you get a one-off combination to type into the lock.

“Toilets are a big part of our business,” says CoinCode’s Christer Granath. “Coins have a cost – you need to have someone to collect them, you need to store and bank the cash, and there is always a risk of theft.”

Sweden recently changed its coinage, giving a further incentive for public places to do away with coin-operated toilets altogether. McDonald’s has installed the cash-free pay toilets in some of its Swedish outlets.

The trend away from cash has prompted the bank to investigate whether Sweden should become the world’s first economy to introduce a cryptocurrency, the e-krona. Its concern is that money deposits could entirely bypass the security of the central bank, undermining the country’s payment system and leaving people vulnerable in a financial crisis.

The shift away from cash has had unexpected consequences. Sellers of Faktum, Sweden’s equivalent of the Big Issue, take payments using portable card readers provided by the Swedish startup iZettle. At the end of Sunday services, worshippers wave their phones in the air to show they have donated to the collection.

The proportion of cash payments in the retail sector fell to about 15% in 2016 Sweden
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 The proportion of cash payments in the retail sector fell to about 15% in 2016 Sweden Photograph: Alamy

Perhaps the most striking phenomenon, however, is the explosive growth of Swish, an app that enables Swedes to make or receive payments by connecting their mobile number to their bank account.

Launched in late 2012, Swish has grown steadily with more than 100,000 new users each month. It now has 6.2 million users, more than 60% of the population. In December, there were 24m private payments using Swish and another 6m by businesses, which pay for the service. The most common amount is about 100kr, the company says.

Swish comes into its own when splitting a restaurant bill – one person pays and everyone else Swishes them their share. It takes seconds. But the app is also having more subtle effects on Swedish society, the company says.

“We can see that Swish has changed the way people behave,” said Per Ekwall, a spokesperson. “For example, the night after payday, at one minute past midnight, we see a massive peak of Swish payments, because people want to clear their debts to their friends, colleagues or family members.

“Also … now a stranger can help a stranger – they can Swish the cash right away. We even see cashiers paying for shoppers.”

Ekwall claimed it was “an urban legend” that older people did not use Swish, which has 50% coverage among the over-60s, although it tails off for the over-80s, along with smartphone use.

However, the difficulties of doing without cash have inspired a campaign, called Kontantupproret (“the cash insurgency), which demands that the future of money should be a democratic decision, not left just to banks and businesses.

Back at the toilets in Gothenburg, it seems you do not have to be in your 80s to have problems with the cashless future.

Tofi, 39, has had two bites at the cherry. He tried once with Swish, but left disappointed. Fifteen minutes later, driven back by an urgent need, he tried to get in by text message, but was told the system would not accept his network. “Such a drama over such a little thing,” he said, holding out a handful of coins. “I should just be able to pay and go.”

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