In Sweden, more than 95 per cent of payments are digital. There is therefore potential to reduce the social resources spent on payments by making greater use of the most cost-efficient ways of making digital payments in different payment situations. We can illustrate this with a simple calculation example.^[10] The calculation example is only intended to illustrate a tentative order of magnitude of potential efficiency and the detailed figures should be interpreted with great caution. First, we assume that all people in Sweden use only the most cost-efficient payment instrument in each payment situation. This means that Swish is used for person-to-person payments and payments for online purchases, debit cards are used for person-to-business payments in shops and cards are used for recurring payments. In this simple calculation example, the total social costs of payments for 2021 would decrease by approximately SEK 8.5 billion from 0.93 per cent of GDP to 0.78 per cent of GDP.^[11] For bills (e-invoices and other digital credit transfers) we do not make this kind of assumption because they offer different services. Therefore, they are not substitutes in all payment situations. This corresponds to a reduction in social costs of almost 17 per cent.

However, it should be emphasised that the simple calculation example above does not take into account all relevant factors. For example, investments in technical equipment and new IT-systems may be needed for businesses and payment service providers to handle so many payments with the most cost-efficient ways of paying in each payment situation. Furthermore, unit costs for each payment method are affected by redistributing the number of transactions between them. The cost per transaction normally decreases as the number of transactions increases, due to high and static fixed costs that give rise to economies of scale. Similarly, the costs per transaction increase for those payment instruments with fewer transactions. Additionally, in the short term, a lot of the costs for some payment instruments would remain even if no one uses it. Finally, it could be the case that we lose important socio-economic values if all payments are moved to one payment instrument.

If we study some individual payment situations based on the calculation example above, further interesting differences emerge. For example, the social costs of payments between private individuals could be reduced by 44 per cent if all payments were made using instant payments such as Swish or new services for instant payments. In turn, the social costs of payments in physical stores could be reduced by 27 per cent if all payments were made with debit cards. It is worth remembering that just a few years ago it took much longer time to pay by card in a physical store, because you had to insert or swipe your card and enter your PIN regardless of the amount of the purchase. Nowadays, it is often enough to tap your card to pay, which has contributed to card payments in shops being considerably faster. According to the Riksbank's current and most recent cost study, the time for a card payment in shops has fallen from 25 seconds in 2009 to 12 seconds in 2021. If all online payments were made using Swish, the social costs could be reduced by 25 per cent. Finally, the social costs of recurring payments from individuals to businesses would be reduced by 56 per cent if all direct debits (Autogiro) were replaced by recurring card payments.

At present, Swish is the only payment instrument in Sweden that offers instant payments. As of May 2022, the Riksbank has offered a system for settling instant payments – RIX-INST – which makes it possible for banks and other actors to offer services for instant payments. In the long term, we will therefore potentially be able to see a number of new actors and services, in addition to Swish, offering instant payments. However, this depends entirely on which services market participants choose to develop. One example of a new service could be paying bills with instant payments. Such a service could contribute to lower social costs as bill payments with digital credit transfers have a relatively high social cost per transaction.

One important benefit of instant payments is that they are made piecemeal and that fewer actors and systems are involved in the underlying payment process compared to card payments and other digital payments initiated via online or mobile banking. In other words, instant payments could increase efficiency and reduce costs for society as a whole, by scaling back costly steps in the payment process. Therefore, the promotion of instant payments by market participants, regulators and central banks is important for the continued efficiency of the payment market.