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Even if, in the next few years, Swedes use almost no cash at all, going 100% cashless needs a political decision. The idea of cash, even in Sweden, remains very strong.
Sweden has as much said that they have no intention of eliminating cash for at least two decades. But if the stores opt to eliminate cash registers, then cash may be of very limited use. If the Riksbank only circulates small bills and in limited quantities then cash may not be eliminated, but it will be of little use.
Stores would have much less problems if they eliminate cash. They don't have to worry about big problems like employee theft or being robbed by outsiders. They also don't have to worry about counting and transporting cash. There costs will go down considerably.
The banks have reduced their cash handling to the ATM only. They will not accept or distribute cash from a teller window.
Quote:
Originally Posted by elnina
Eliminate paper currency and what you end up with is the elimination of the ability to demand to withdraw funds from a bank.
Not a pretty scenario IMHO.
Not a pretty scenario indeed. It's a major change in world finance Coupled with negative interest rates and the possibility is frightening.
But many Swedes like the idea of never carrying cash.
Swedes are light years ahead with most everything. I am sure they know what they are doing.
That doesn't mean that the same model will work in other countries.
BUT: we should go back on topic and discuss ... Canada
Sweden has as much said that they have no intention of eliminating cash for at least two decades. But if the stores opt to eliminate cash registers, then cash may be of very limited use. If the Riksbank only circulates small bills and in limited quantities then cash may not be eliminated, but it will be of little use.
Stores would have much less problems if they eliminate cash. They don't have to worry about big problems like employee theft or being robbed by outsiders. They also don't have to worry about counting and transporting cash. There costs will go down considerably.
It simply wouldn't be a viable business decision to remove cash from stores. The business would lose on so many potential transactions and a huge loss of potential profit if they were to get rid of cash so I don't think that would happen. Unless literally 90% of Swedes don't carry cash, I'm not sure on the statistics.
It simply wouldn't be a viable business decision to remove cash from stores.
Well it would be unthinkable in the USA and presumably in Canada. I suspect it is only possible in some very high end retailers and a few restaurants. In Sweden sometimes the ice cream shops won't take cash.
I would like to point out that Sweden was one of the most cash intensive countries in Europe 30-40 years ago. At the time they had a 10,000kr banknote which was worth way more than the US$1000 , or the present day Swiss Franc 1000 or the Euro 500. Sweden also printed the first paper banknotes in Europe in 1661. The Swedish government started by disallowing checks and pushed electronic payments.
The most vulnerable currencies to this push for cashless society are the smaller currencies of otherwise wealthy nations. The currencies of Iceland, Norway, Sweden, Denmark, Canada, Bermuda, Cayman Islands, New Zealand and Korea.
Remember, there is a skim by the bank to process credit card transactions. They charge the merchant anywhere from 1 - 5%, depending on the card. My understanding is that it's even worse in some countries. I wonder if the banks aren't behind the push away from cash. They want to be a partner in everybody's business.
I pay in cash for many things and do carry hundred dollar bills. But that's not true at all about them melting in the dryer. They not only don't melt, they don't even need ironing as I found out by accident. I don't know what you mean by 'warp.' They won't stay bent if you bend them, that's true, but if you fold them over and stuff them folded over in your pocket or wallet, they do stay folded. They just spring back to their original shape when you take them out of your pocket.
I had two $5 bills melt together in the dryer .. I usually don't use a hot cycle but for some reason I did that day. They couldn't be separated - the bank replaced them.
I have a really bad habit. I toss bills into my purse or my pockets and they get all scrunched up, creased and wrinkled when stuff is shoved on top of them or they get pushed into a corner. Never have used a wallet. In the US I can just fold them back along the long way in the middle and that straightens those bills out easily so I can pile them back up .. with the older 'linen' papers used .. they aren't perfect but they do go flatter than my Canadian bills when I treat them the same way. With Canadian bills, I can never seem to get the creases out and they never lie flat again in my experience. It is one thing perhaps to gently fold them in a big wad .. it is quite another to fold them individually or scrunch them up so they crease. It may be my fault but it is a nuisance for me. I don't think I will ever get used to that 'plastic' feel either.
Despite your assertation, I am not sure I am going to chance ironing them after the dryer fiasco. But thanks for the hint.
I keep all my polymer currency flat together in a wallet. Sometimes I will put tight folds in new polymer bills to stop them from sticking to each other when they're all flat together. If I want to get the crease out later I fold them again along the same crease in exact opposition to the original fold. Voila !! It is straightened out again. It doesn't make them 100% perfectly flat but it's flat enough that it's good enough for me. I can't stand crumpled and creased up currency, I like it tidy and manageable.
I wonder if the banks aren't behind the push away from cash.
Wonder no further, because cash is a massively money losing business for commercial banks. Cash must be counted over and over. It must be transported and in Sweden the central bank pays negative interest rates on cash deposits by commercial banks.
Value of banknotes and coin in Sweden compared to the USA at end of 2015
21% Banknotes and coin in circulation outside banks
9% Banknotes and coin held by banks
The banks are going cashless in Sweden faster than the people in the streets.
After the new banknotes are printed and new coins are minted in Sweden by this summer, the central bank is going to consider the value of issuing an electronic currency backed by the government. This would be electronic currency that unlike credit cards would have no skim by commercial banks.
The major cost of credit cards is dispute resolution where the customer disputes a charge. Electronic currency has no dispute resolution since each transaction is as final as those done with physical cash. Just as physical currency payments in excess of $10,000 are required by law to be accompanied by an IRS form no government will permit anonymous electronic transactions of unlimited value. It would be a money launderer's dream. Given the ease by which money can be moved electronically, it is quite possible that the upper limit for anonymous transactions will be considerably lower than $10,000.
Over the last four years USA has increased circulation of the US$100 from 25 to almost 34 banknotes per capita. Canada has increased circulation of $100 from 9 to 11.5 notes per capita. Sweden has decreased circulation of the 500kr=CAD$73 banknote from 12 to 10 banknotes per capita.
Year USA CA Sweden
2015 33.7 11.5 10.1
2014 31.9 10.5 11.8
2013 29.3 10.0 12.0
2012 27.5 9.4 11.9
2011 25.1 9.2 12.0
In the 13 months since those statistics were assembled, Sweden has reduced their 500kr banknotes to 4.7 old banknotes and 2.4 new banknotes per capita. By the end of June the old banknotes will no longer be legal tender, so it remains to be seen how many new banknotes will be produced in the next few months.
The last year Sweden had more cash on a per capita basis than Korea was in 2013; United Kingdom and Saudi Arabia in 2012; Canada in 2008; and Australia in 2006. By the end of 2016 Sweden should be lower than Russia, and possibly lower than Mexico and Turkey by the end of 2017.
The USA seems unlikely to reduce their circulation levels of c-notes. But perhaps Canadian citizens might want to suggest to their representatives that they should pass a law guaranteeing that the government will continue to circulate at least 9 or 10 $100 notes per capita in case they decide to take the Swedish route.
Last edited by PacoMartin; 02-18-2017 at 05:51 PM..
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But thanks for the hint.
