Sweden: Where cash will never be king

Could Sweden become one of the first cashless societies in the world? Probably, says a researcher at the Royal Institute of Technology. Here's how, and why.

Sweden: Where cash will never be king

Sweden recently got a brand new set of bills, sporting historical Swedish heroes and looking better than ever. There's also a new 200 kronor note, whereas before it leaped from 100 to 500.

But the new wave of cash is a little ironic, given that Sweden is well on the way to abolishing cash entirely. So why come out with more of it now?

“The decision to bring new notes was made five years ago,” says Niklas Arvidsson, professor at the Royal Institute of Technology who researches cashless society.

He says that there were multiple reasons for renewing the currency, including better security and avoiding counterfeit problems. And despite Sweden's long-lasting love affair with digital payments, Arvidsson says it will probably still be another decade before Sweden is entirely cashless.

But it's already quite close. In Sweden only about 20 percent of store transactions involve cash – compared with 60 to 80 percent in most other countries.

Not even many Swedish banks deal much with cash these days. “Cash carries an increased risk of robbery, and administrative costs,” Arvidsson explains. “The banks which do accept cash require that you explain where the cash has come from, to ensure it is not laundered or financing terrorism.”

Read more about the new Swedish bank notes

At this rate, Sweden may become one of the first cashless societies in the world, according to Arvidsson's research. He recently published a paper studying the Swedish electronic payment system Swish – which he says is one of the largest cash-killers.

Sweden was one of the first countries to join the electronic revolution, launching e-bills and payments, electronic bank accounts, and mobile banking.

“Swedish banks are good at joining advanced IT systems early, and in combination with a very strong IT sector, that has led to multiple competitive financial services.”

Swish is the next development, launched in late 2012.

Stockholm in spotlight for financial tech

“Cash is still an important payment method in many countries, but not here in Sweden anymore,” he says. Today there is some 80 billion kronor in cash circulating in Sweden – but in 2009 that number was 106 billion. And it continues to drop quickly. “

And only about half of that is circulating regularly,” he says.  “The rest is sitting at someone's home or somewhere on the black market.” 

In order for a society to truly go cashless, everyone in the society needs to be able to use the new, in this case digital, method. That includes older generations who may not be as familiar with modern technology, as well as those who live on the countryside.

The app Swedish is so simple to use, though, that Arvidsson says it is already conquering the hearts and wallets of cash users.

Another potential challenge of a cashless society faces homeless and paperless migrants: If there is no cash to give, they are (literally) left out in the cold.  But of course there are benefits as well. A digital, cashless society is simpler, more cost-effective, and more open, since transactions are easier to track.

If Swish's popularity continues to grow as quickly as it has, then it could entirely replace cash.

“Swish is like cash in the sense that it is a direct payment which occurs in real-time,” Arvidsson elaborates. “The system's biggest strength is how fast and simple it is.”

Read also: Sweden close to being a cashless society

Currently most Swish transactions are between private users, but stores and online boutiques are starting to try it out. The infrastructure may have to rebuilt to handle the shift to industrial use, but Arvidsson says it probably won't be a problem.

“Swish is already revolutionizing the entire essence of Swedish banking.”

Swish works together with the Swedish bank, Riksbanken, in order to carry out its transactions in real time. And that is a critical aspect of the app's functioning. Without that kind of cooperation it would be impossible – which is why it may be tough to export the Swish model to other nations.

“It's a great idea, but it will take a long time for other countries' bank systems to change from the ground up,” he says.  “But if they figure that out, Swish could lead an international revolution.”


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How to save money at Sweden’s airports

Sweden is not a cheap country by any means, and the extra charges at airports can make travelling feel even more costly. Luckily, there are ways to make trips to Swedish airports more affordable.

How to save money at Sweden's airports

Sweden has become increasingly expensive over the past few years, in line with the cost of living crisis, inflation and rising food prices affecting much of Europe.

These significant price increases make the high costs at Swedish airports even more noticeable, leaving many travellers, already burdened by inflation, feeling the pinch.

Luckily, there are ways to make your stay at Swedish airports more affordable.

Bring your own food – or buy it before getting to the airport

When travelling through a Swedish airport, according to the official information on the Sweden’s Transport Agency’s website, you are allowed to bring solid food through security and onto the plane.

However, if the food is considered a liquid, restrictions will apply. Liquids include foods such as jellies, creams, drinks, soups, and dishes with both solid and liquid components (like meat and potatoes with sauce or pickled cucumbers). This rule applies even if the food is frozen.

Use this information to prepare your own meals (sandwiches are a good option for longer flights, while snacks may do the trick for shorter ones) or buy food before you get to the airport.

Both will lead to saving a lot of money compared to airport food prices.

Cutting (transport) costs on your way to the airport

Sweden’s major airports have express services that make getting there quick and efficient, but these can be a tad expensive.

Fortunately, there are cheaper alternatives.

For example, in Stockholm, you can take the non-express commuter train instead of the Arlanda Express or combine a train plus bus option.

Both options cost less, though they do take longer (the express train trip lasts around 20 minutes, while the cheaper alternatives will take around 40 minutes).

For a detailed guide to your transport options if you want to skip the Arlanda Express (or if it isn’t running), check out The Local’s guide on the topic here.

Do your research before getting there

All of Sweden’s busiest airports are operated by the state-owned company Swedavia, which makes it easier to check out your dining options in advance.

Knowing where to find the cheaper and more expensive eateries can help you plan better.

You can find an overview of available restaurant, bar, and cafe options on a per airport and per terminal basis, as well as their opening hours, on the company’s website.

For Arlanda Airport, check here. For Landvetter, here.

Keep in mind that the most affordable options might be before security.

Are lounges worth it?

While suggesting you spend money on a lounge might seem counterintuitive, it can sometimes be a cost-effective option. You’ll just need to do some simple maths to determine whether it’s worth it.

A meal and a drink at a Swedish airport could easily cost a few hundred kronor.

Lounges, which typically include buffet food and drink options, might offer better value for money, if you’re planning to buy food in a restaurant at the airport rather than bringing your own with you. They also often have shower facilities, office spaces including printers, and children’s areas, which may make the cost worth it depending on your journey and whether you’re travelling with family or not.

For the SAS international lounge at Arlanda, the cost is usually around 350 kronor when purchased in advance online and slightly higher if bought at the lounge reception on the day of your visit​.

Note that if you are a frequent flyer or have certain credit cards, you might have access to lounges for free or at a discounted rate, using points to pay for some or all of the fee.

Don’t buy the first thing that seems cheap at the airport – a better deal might be waiting outside

Many items found in airport stores and duty-free shops are available outside the airport, and often at better prices.

While duty-free items are tax-free, you might still find better deals by shopping around elsewhere (in fact, this is often the case for both food and drinks).

Resist the temptation to buy stuff that seems cheap at the airport unless you’re absolutely sure you’re getting a fair price. You can always do a quick Google search before you buy to see if you can get it cheaper somewhere else.

You will likely save more by purchasing it outside the airport.