Cash in Sweden: the Reality

Bancomat AB was registered in 1968 in Sweden, and it is the second oldest ATM operator in the world. It was incorporated in 2010 and is owned by Danske bank, Nordea, Handelsbanken, SEB, Swedbank and some savings banks.

While the first ATM started work in June 1967 in the UK, the second started two weeks later in Sweden. A shame not to have been first given a Swedish bank issued the first European banknote in 1661 and it had the first central bank founded in 1668.

But will Sweden be the first to go cashless?

Cash today

Cash usage as a percentage of in-store payments has fallen from 39% in 2010 to 8% today. Between 2009 and 2019 Sweden had the lowest percentage increase of cash in circulation in the world, -42%. Norway was the only other country with a negative score, -23%. Despite that, Sweden had about 250 million cash withdrawals by its 11 million population in 2022 and the number of cash transactions is over 50 million per annum, and on a slightly upward trend.

Since 2012 Sweden has had a person- to-person instant payment tool, Swish. Eight out of the 11 million citizens have an account, effectively all adults, and it is used online more than cards. 96% of Swedes have a smartphone. The decline of cash and the rise of Swish are closely correlated.

Despite that, 10% of Swedes are not digitally or financially included, some 1 million people. Research shows that some of these people used cash for integrity reasons (protection against abuse), for financial control or personal preference.

Access to cash

In 2021 a law was passed requiring citizens to be able to withdraw and deposit cash from a source within 25 km by road from where they live. This has been achieved for 99.7% and 98.3% of people, respectively. Sweden has adopted an ATM pooling solution which is run by Bancomat, and Bancomat has to decide where ATMs are located.

This is necessary because it is not possible to make money providing cash. Without a subsidy no banks now provide cash services.

Bancomat is bringing cash in transit (CIT) services inhouse to serve its own needs only and will achieve this by mid-2025. This is driven by the decline in cash services by Sweden’s CITs.

Government approach

In addition to the access to cash legislation, the Swedish government now wants to preserve cash as a payment option for reasons of resilience, as well as payment choice. A series of digital payment outages have raised concerns. In July 2021 Sweden’s second largest grocery chain was targeted by the supply chain attack Kaseya. It led to the closure of all its 800 shops for up to six days. In addition, self-scanning and the remove of cash check-out counters in retail outlets has made paying by cash difficult.

The Russian invasion of Ukraine which saw cash withdrawals increase 30% in the week the war started.

Four new cash state cash depots are being built. Government and healthcare have to accept cash payments. Work is going on by cash companies and government entities to find areas for co-operation.

Final word

Bancomat does not see Sweden going cashless any time soon. But the consequences of less cash and the challenge of safeguarding cash are causing the country difficulties.