According to a survey, the Swedish population isn’t keen on the e-Krona, the digital currency recently proposed by the central bank at a time when cash usage in the country is rapidly declining.
Riksbank, Sweden’s central bank which is, incidentally, seen as the world’s oldest central bank having issued paper banknotes in the 1660s, hinted at developing and issuing its own digital currency before the turn of the decade. Sweden has seen physical cash circulation drop by 40% since 2009 as Swedes turn toward cards and digital payments for transactions.
Having taken notice of the trend toward a cash-free society, Riksbank’s deputy governor publicly revealed plans for a central bank-issued digital currency in November 2016. The “e-Krona” or the “e-Crown” is seen as the digital alternative to the Swedish crown, equivalent in value to its paper counterpart.
Cecilia Skingsley, deputy governor at Riksbank stated at the time:
The less those of us living in Sweden use banknotes and coins, the clearer it becomes that the Riksbank needs to investigate whether we should issue electronic money as a complement to the money we have today.
However, a survey taken by Swedish social research firm Sifo revealed that a majority of Swedes aren’t particularly encouraged by the prospect of the e-Krona. A total of 1268 people were polled, according to regional publication BreakIt, aged between 16-79 years during a 3-day period in December, within a month after the Riksbank’s announcement.
The survey, taken on behalf of Swedish digital payments firm Tieto, revealed that half of those polled did not want the e-Krona to be issued at all. A third did not care about the subject at all. This, despite 67% of those polled being aware of bitcoin, the most widely-used and prominent digital currency of them all. Still, only a stifling 2% of respondents had used bitcoin. Altogether, only a tenth of those polled favored the e-Krona.
Digital Innovation Came Early
The lack of interest in the e-Krona can be pinned upon a sense of contentment among the wider public when it comes to alternative payment options. The lack of bitcoin usage despite the familiarity of the world’s well-known cryptocurrency is among a population that has already seen plenty of other payment options since 2010, contributing to a significant reduction in cash usage.
Put simply, the Swedish public gained early access to digital payments and Fintech and do not see any inherent value with a central-bank issued digital currency.
“Were e-Krona become a reality, Sweden would become the first country in the world with its own digital currency,” stated Charlotta Wark, director at Tieto, the Swedish payments firm that sought the survey.
The initiative can help to accelerate the development of new digital services in the area, which is positive. At the same time, there is a reluctance among consumers about the added value such an exchange can provide, not least at a time when more and more alternative digital pay services are launched.
Shot in the Dark
Another factor contributing to the underwhelming public reaction to a Swedish digital currency is the lack of a proven use-case with a central-bank issued currency, which could lead to trepidation among the Swedish population.
At the time of the announcement in November, Riksbank’s governor Skingsley addressed how issuing the e-Krona could prove a tricky effort.
Although it may appear simple at first glance to issue e-krona, this is something entirely new for a central bank and there is no precedent to follow.
Sweden’s Riksbank is expected to make its decision about its digital currency within 2018.
Image from Shutterstock.