While the aim of 'cashless' economy seems ambitious for a diverse country like India, the idea, in itself, is not unachievable -- this European country is proving it.
In 2016, with demonetisation, Prime Minister Narendra Modi also pushed for a building a ‘cashless’ India, an economy where credit and debit cards, mobile wallets, and payments gateways will take over cash. While the aim of ‘cashless’ economy seems ambitious for a diverse country like India, the idea, in itself, is not unachievable — Sweden is the proof.
Sweden is on the track to leave cash behind completely by 2023, a new study has said. According to researchers, Niklas Arvidsson and Jonas Hedman cash will no longer be used or accepted by Swedish retailers by 2023, at the earliest. “We are a small country that has had a very stable democracy for a long time,” World Economic Forum quoting Niklas Arvidsson said. “For us, it’s no problem that the money is only visible on an internet site – we trust it.”
80% of all transactions currently in Sweden are already being made by debit or credit cards, even the smallest ones; it is so common that people in the country do not feel the need to carry cash anymore. Sweden is becoming world’s first cashless society as the country has embraced Information Technology, as well as has cracked down on organized crime and terror, according to a study from Stockholm’s KTH Royal Institute of Technology.
A collaboration between major Swedish and Danish banks is also one of the major reasons behind Sweden going cashless. The country uses a direct payment app Swish that allows transactions between individuals in real time. “The service’s direct collaboration with Bankgiro and Sweden’s national bank, Riksbanken, is a critical factor in its success,” Niklas Arvidsson said.
Back home in India, while a majority of population and businesses are still dependent on cash, the strides taken towards promoting a cashless economy is getting lauded. India’s innovative and free homegrown digital payments ecosystem BHIM UPI has got support from Google’s Sundar Pichai, Dell’s Michael Dell, and economist Nouriel Roubini.