Sweden weighs benefits of ditching cash

By Tim Mansel

image captionCould all this become a thing of the past?

In many countries, debit and credit cards are steadily taking the place of cash in everyday transactions. In Sweden, the process has been given new momentum by a campaign to cut crime.

Marie Jarvas, a bank worker in central Stockholm, has experienced two robberies.

"The first one was early in the morning and two men broke through the glass door with an axe.

"What they wanted was the box with the cash for the ATMs," she recalls. "I was really scared and I ran into a back room and hid behind a cupboard. I was sure they were going to come and shoot me. I was really scared for my life."

Two years later it happened again. This time, a man brandishing a gun jumped in the bank's front office through a window that had been smashed by car.

Ms Jarvas's union is now leading Sweden's drive to do away with cash, out of concern for the safety of the 30,000 bank workers among its members.

"If we can reduce the amount of cash in the banks and in society in general, robberies will also be reduced," says Marie Look, of the bank workers' trade union.

"If in the long term we abandon cash completely, there will be no robberies, because there's no point in robbing a bank if there's no cash there to steal."

The campaign has some high-profile supporters, including former Abba band member Bjorn Ulvaeus.

"There are no direct practical reasons, as far as I can see, to have coins and banknotes," he wrote in a recent blog post.

image captionBuses have already gone cash-free

"There are obvious advantages in getting rid of them. Sweden should be able to be the first country in the world to do this."

He said that it was "patronising" to assume that the elderly, for example, would have problems paying for goods or services over the internet or with a card.

"There are, of course, those who need help, but if as a result they run less of a risk of being robbed, then perhaps it would be worth the inconvenience," he wrote.

Buses in Stockholm have already gone cash-free. Strips of tickets or sim-based bus cards can be bought in advance, or payments can be made via mobile phones. After a series of attacks against bus drivers, Sweden's health and safety authority stepped in and told the bus companies they had to find a way of protecting the cash more securely. The result was that buses stopped accepting notes or coins.

"All indications are that there have been a lot fewer problems on the buses. The drivers are very happy with the situation," says Bernt Nilsson of the Swedish Work Environment Authority.

The Swedish central bank takes no position in this debate. But in a speech earlier this year, the bank's deputy governor Lars Nyberg highlighted the higher cost to society of cash transactions, compared with those made with credit or debit cards.

Citing a survey from 2002 he said: "It is much more likely that the costs of using cash have increased rather than decreased. For example, the costs for increasing the security of transportation and ATMs have been substantial."

image captionThe buskers have a stay of execution

Over the past 10 years, the value of card payments made in Sweden has increased fivefold, while the number of card payments has increased by a factor of eight.

"The technology exists for a cashless society to work," says Andrew Scott, Professor of Economics at the London Business School.

Cash survives, he says, despite the nuisance of bulging pockets and looking for ATMs that work, partly because it preserves privacy.

"Its key advantage, in an electronic age, is that it is anonymous and tells you nothing about where it's been," he says.

Par Strom, of the New Welfare Foundation in Stockholm, says Sweden's move towards a cashless society is worrying for precisely this reason.

"If it's impossible to pay cash when you buy stuff, it's also impossible not to leave electronic footprints behind you, and the electronic footprints from what you buy put together can tell the entire story about your life. This can be very sensitive information," he says.

"Most people don't want this total surveillance society."

Bernt Nilsson says it will be several years, at least, before Sweden can finally rid itself of cash.

So the buskers at Stockholm's tourist spots will continue to entertain passers-by with their tunes on the accordion or pan pipes for the foreseeable future.

But, while it's possible to imagine buying a newspaper with a credit card, the entertainers will definitely take a hit once the cash disappears.