Ingves: Efficient payment systems and the Riksbank’s approach to cash distribution
On Tuesday, Governor Stefan Ingves talks about cash usage in Sweden and the Riksbank’s role in promoting an effective payment system at a conference arranged by the central bank of Argentina. He describes Sweden’s path towards a society with increasingly less cash usage.
The Swedish payment market began to take shape nearly 100 years ago, when Postgirot (now Plusgirot) was created. To counter this, the banks teamed up to create Bankgirot. "This was the start of a number of cooperation projects among Swedish banks that have continued to this day. They help give Swedish households and companies access to efficient payment services, with which they can reach all payment recipients," notes Mr Ingves. Other examples of cooperation include the decision to create a national debit card; without using the global card brands, Swish and Bankomat.
He also says that technically knowledgeable households and companies, together with a well-developed telecommunication and broadband network are important reasons for the large-scale use of electronic payment services in Sweden. The Riksbank's role in cash distribution after 2005 has incentivised banks and cash-in-transit companies to rationalise their distribution and circulation of cash. That was when the cost of cash management became visible. "Together, all these factors have contributed to a long-term trend of diminishing cash usage, where Sweden is one of the countries in the world that uses the least cash. Whether this trend will continue unabated and how we will make payments in the future is an open-ended question," Mr Ingves says.
