Sweden assures paper cash

Sweden’s Riksbank has become the first central bank in the 21st century to take concrete measures to ensure that cash does not disappear as a means of payment from the financial system. To that end, the Riksbank proposes, in a document published on its website, to make it mandatory for all banks and financial institutions to offer cash services.The pronouncement comes in response to a recent policy suggestion by the Riksbank Committee that only the country’s six major banks should be obligated to continue offering cash services.That prompted a backlash from Sweden’s competition watchdog, which argued that the plan would distort competition as it would affect only a few of the nation’s banks. In response, the Riksbank has opted to apply the rule to “all banks and other credit institutions that offer payment accounts.”

But they were supposed to go completely cashless, what happened?

Nominal deposit rates might rise in the future, right now they are negative slightly.   The slightly negative rates are not passed on to consumer accounts, hence the acceptance of account based money.  Now rates might go up and those accounts earn money, from the bankers. 

Adding paper cash does not solve that problem, they need digital cash.  When account holders have more convenience than paper holders then paper cash adds transaction costs. The central bank there considered pure bearer digital cash, and is still considering it. But for now, they want a paper placeholder.