Sweden ponders switch to a cashless future

Sweden is examining plans to embrace a cashless future and launch the world's first state-issued digital currency, the ekrona.

The country's central bank, the Riksbank, yesterday announced an inquiry into how such a system could work.

"It would be a radical move for the world's oldest central bank," says The Times, "and would hasten the demise of notes and coins in the Nordic countries".

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

Across the region the number of notes and coins in circulation has plummeted by 40 per cent since 2009 as consumers opt for card payments instead of cash.

But the trend doesn't just reflect the rise of non-cash transactions – the bank is also seeking to get on top of a digital revolution triggered by Bitcoin, the digital currency, that could sideline central banks in the monetary system.

Speaking to the Financial Times, Cecilia Skingsley, the Riksbank's deputy governor, said the switch to a cashless future was "as revolutionary as the paper note 300 years ago".

It was "not an option for the public sector to stay on the sidelines and see the private sector cut off access to central bank money for individuals", she said.

She added: "What does it mean for monetary policy and financial stability? How do we design this – a rechargeable card, an app or another way?"

Interest in Bitcoin, the most widespread digital currency, is growing among financial institutions. Its block-chain technology, based on a complex set of algorithms, allows digital currencies to be verified over a network of computers without a central ledger.