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Europe Case Studies on Cashless Society

DIGITAL VENTURES September 26, 2017 10:18 AM


Thailand has recently introduced several cashless services such as e-wallet or QR Code payments. This was made possible due to the awareness and adaptation of financial institutions who want to bring Thailand to a cashless society. That is why we are currently hearing a lot of information regarding the matter. Today, let us have a look at Europe who are the early-adopters of cashless society.

Overview of Europe and cash usage

Cashless society in Europe has become quite ordinary. Cash transactions in certain countries such as Sweden even seem quite outdated. Although there is still cash usage in Europe, it is forecasted that by 2020, cash transactions will amount to only 0.5% of all payments. Cashless Society is not only confined to the Euro Zone, Armstrong Economics reports that the European Payments Council (EPC), a sub-division of the European Central Bank, is attempting to expand the cashless system throughout the European Union. A Single Euro Payment Area (SEPA) was initiated with the objective to terminate ATM and implement the use of transactions via mobile phones and cards such as credit or debit cards. This project will commence in November 2017.

Graph from


Europe’s declining trend of cash usage

From the graph, we can see that Norway is closest to becoming a cashless society with only 7% of cash transactions (a decrease from 11% in 2011). Scandinavian countries have low trust for cash, this can be seen from the transactions in several countries. In 2016, Sweden only has 18% cash transaction with 26% in Denmark. Wallets are being replaced by cards and mobile phones.

Greece – First country to stop using cash

The Bank of Greece proposed measures to tackle tax evasion by electronic transactions and limiting the use of cash in the economic system. This also includes tax reform plans which are all part of the strategy to bring Greece to a cashless society. However, some see that electronic transactions may benefit banks and the government rather than the users. This is because the people may not be controlling their own money with schemes such as taxing cash at the ATM or forcing it out of the banks via punitive interest during these few years.

Norway – The first cashless society

Norway is the first-adopter of cashless society with plans to terminate cash usage by 2030. It can be observed that in early 2016, the largest commercial bank in Norway, DNB, proposed to halt cash transactions as more than half of cash transfers are beyond the bank’s control. These transactions may bring about money laundering or other illegal activities. Another major commercial bank also declines cash transactions with only one remaining branch, the Oslo Central Station, open for such transaction. Norwegians are quite enthusiastic with the cashless idea resulting in only less than 5% of cash usage.

However, opposing parties believe that the cash system should still exist for privacy and security because digital technology risk information intervention and several central banks can be affected. An opposing representative mention that cash payment is the most reliable system when the system is down. Moreover, limiting cash will affect elders who don’t use electronic transactions and usage among younger generations will be more difficult. They view that cash is still the most effective tool for teaching children about the value of money.

Sweden – A good example of a cashless society

Sweden has also fully become a cashless society. In the previous year, the use of coins or banknotes amounts to only 1% of the overall payments. The “we don’t accept cash” signs are a common sight in this country. A bakery manager with 16 branches mentioned that the cashless system lessens the risk of theft and customers pay quicker when using cards. At present, Sweden is using cash in stores at less than 20% of the total transactions, this is a 50% decrease from 5 years ago. Coins and banknotes are prohibited for bus fares while casinos only accept cards.

Store sign in Sweden from

Check out an example of a cashless society in this video from the World Economic Forum.

Payment via smartphones is also common among Swedish residents with up to 10 million users or more than 50% of the population. A majority of the Swedes agree that cash-free will make them safe from theft while more and more retailers are beginning to use credit card readers that connect to mobile phones. This helps with convenience when purchasing goods and when people purchase more, more money circulates within the country.

Swedes are early-adopters of the innovation due to their interest in technology. Moreover, Sweden is among the most connected countries in the European Union making experiments easy and have a lower negative impact.

Another highlight regarding the development is that Swedes trust financial institutions and are not afraid of the “Big Brother” issue or fraud linked to electronic payment.

Denmark to stop producing its own currency and other countries entering cashless society

Denmark is following the cashless trend, along with Sweden and Norway, and stopped producing banknotes since December 2016. Shutting down the mint is a result of waning popularity for banknotes. Aside from the three countries, Venezuela is also attempting to halt the use of banknotes, particularly when they are mostly used by criminals.

From the above samples, we see that European countries view that the cashless society is about security from theft and convenience for users. Entering a cashless society differs among cultures as the way of life is directly affected as well as the population’s attitude towards technology. Follow us for more updates about Cashless Society in Asia in our next blog.