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Sweden Launches Investigation into the Role of the State in the Payment Market

Categories : Cash does not require a technology infrastructure, Cash is a public good
January 4, 2021
The Swedish government has announced that a special investigation will review the role of the state in the payment market and take position on what the role should look like in the future. The final report is due no later than November 2022.
Guillaume Lepecq

Chair, CashEssentials

This post is also available in: Spanish

The Swedish Payments Laboratory

Sweden is often considered a payments laboratory for the rest of the world. It has often been at the vanguard of different trends. It is amongst the countries with the lowest levels of cash in circulation, measured in relation to GDP, as illustrated by the chart below.

Sweden is also among the first countries to adopt regulations to ensure the access to and acceptance of cash. A new law took effect on January 1st, requiring banks to provide adequate cash services. The law was designed to protect the more fragile people such as older people, migrants, those with disabilities, the rural or those who do not have access to digital payments.

Riksbank Calls for Further Protection of Cash

The central bank has voiced concern about the risks associated with the privatisation of money. In 2018, Riksbank’s Governor Stefan Ingves wrote,

“the payment system is often said to have an element of public good, which implies that the public sector has an important role – in this case, in ensuring that payments can be made safely and efficiently at all times. Other examples of public good are the armed forces, the judicial system and official statistics. Most citizens would feel uncomfortable handing these public services to private companies entirely.”

In October 2019, Ingves called for more robust legal protection for cash. “If it were to be established by law that one was forced to accept cash in Sweden, more of us would probably choose to have cash in our wallets.” said Ingves. The Central Bank had proposed to the Parliament in April to establish a committee to review the concept of legal tender.

Sweden has also been amongst the first countries in the world to consider introducing a digital currency. The central bank is already running a pilot project with Accenture Plc to raise an e-krona based on the same blockchain technology that underpins digital currencies like Bitcoin.

On 11 December, the Ministry of Finance announced that a special investigator would review the state’s role in the payment market and determine what the part should look like in the future. The review will be based on a thorough and broad analysis of the following:

The Division of Roles Between State and Business

The investigator shall, among other things:

A reference group with representatives of all political parties in the Riksdag shall be attached to the investigator. The review must be completed no later than 30 November 2022.


This post is also available in: Spanish