Living in a Cashless Society
Sweden's state-backed digital currency will be tested until 31 December 2020, with a possibility for extension.
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Physical cash is set to disappear from Sweden as nearly all citizens use a mobile payment application called Swish. Some even estimate that retailers will cease to accept cash by 2023.
This has got Sweden’s central bank worried that people may lose their faith in the money system since they can no longer associate what’s in their bank accounts with a form of cash. As such, Riksbank has decided to test a state-backed digital currency.
The project is set to run until 31 December 2020, with a possibility for extension. "During the first year of the e-krona pilot project, a technical platform will be developed with a user interface that enables, for instance, payment with the e-krona from a mobile phone, a card, and a watch. The platform will also contain simulations of payment service providers, retail outlets and other parts of the Swedish payment system," said a Riksbank press release.
One of Riksbank's economists, Gabriel Söderberg, told MIT technology review that this project is a positive solution, as the central bank would be focused on offering a public good compared to private companies whose purpose is to make a profit. Time will tell how the e-krona performs and if it will be adopted by Sweden's population.