Sweden has been considered as one of the most progressive countries when it comes to payments. Now the country is going to set itself apart from the rest of the world in a new way. It would be the first country to go cash free. Sweden has been taking a clear path towards digital payments. As per new estimates, four out of five transactions are made electronically or by card.
Sweden witnesses 260 credit or debit card purchases per person annually. Popular electronic payment services are gaining traction as well, also contributing to replacing cash. A popular option is Swish, an app for peer-to-peer money transfers using just the mobile number. The app is similar in nature to Venmo and was developed by six of Sweden’s biggest banks. Card payments are not just accepted at retailers but even at newspaper vendors and in public buses.
Why have people adopted mobile payments in Sweden so very well? Why don’t they worry about security? What makes Sweden a leader in mobile payments?
At Let’s Talk Payments, we have written about the success story of digital payments in Sweden. There are both demand (Infrastructure and intent) and supply side factors (collaboration between industries). The mobile internet penetration in Sweden is about 92.7%, which probably also translates into heavy usage of internet and connected apps on mobile devices. Sweden is the most active market for app downloads with an average of five downloads per Smartphone user per month.
Sweden is quietly writing history with their mobile payment revolution. There are no adoption issues and it’s a norm to use mobile for transit tickets, buying online or paying at stores. Even the technology sector is not behind and there are a number of solutions in the market:
Here are some examples of industry-backed payment programs in Sweden:
Telecom – Swedish Mobile-phone operators Telia, Tele2, Telenor jointly started a service in 2013 called WyWallet, their own payment system which opened the gates for 97% of Swedish mobile-phone users to pay for goods at participating businesses.
Bank and Third Party – Like Swish, Swedish mobile payments specialist Seamless, in partnership with various banks in the region, is doing a lot of good work. Its mobile wallet service called SEQR added NFC tag based payments in April 2013 which will provide the users with the option of making payments through NFC enabled Smartphones.
Sweden’s digital payments success certainly can be an inspiration for other nations throughout the world. There’s no doubt that Sweden is one of the leaders in digital payments today and will continue to take the lead in the future as well.
Some major advantages that Sweden has benefitted from:
- Safer monetary environment – retailers and banks have been major driving forces behind cashless payments in Sweden. This makes businesses feel more secure with the absence of cash.
- Fewer bank robberies – as per CBS News, the number of bank robberies in Sweden dropped from 110 in 2008 to just 16 in 2011. The number came down to 5 in 2012. Elimination of cash use reduces the motive for such criminal activities.
- More savings – it can be a major factor behind Sweden’s society going cashless. Lack of cash circulation means savings in cash-handling costs. Such costs have been estimated at $1.2 billion annually.