Skingsley: Considerations for a cashless future

“The alternative to increased regulation of the payment market is that the Riksbank continues to supply a means of payment that exposes the private sector to a certain amount of competitive pressure”. This was the message from Deputy Governor Cecilia Skingsley in her speech today at SNS, the Centre for Business and Policy Studies, in Stockholm.

Date: 22/11/2018 08:00

Speaker: Deputy Governor Cecilia Skingsley

Place: SNS finance panel

A changing payment market

Decreasing cash usage means that central government's presence on that part of the payment market where the general public can be found risks disappearing. The Riksbank has thus spent two years investigating the possibility of issuing an e-krona, as a complement to cash. The project group recently submitted its second interim report. When Deputy Governor Cecilia Skingsley discussed the report at the SNS Finance panel on Thursday, she said that "regardless of whether or not the Riksbank decides to issue an e-krona, the future will bring about changes to the state's role on the payment market".

Introducing an e-krona would be a new step for the Riksbank, which must be analysed carefully. But accepting a situation in which the general public does not have access to cash at all would also be taking a step into the unknown. Issuing digital money, an e-krona, would be one way to preserve a state alternative on the payment market, Skingsley continued.

Increased state governance an alternative to the e-krona

The alternative to the e-krona would be for central government to regulate the payment market in increasing detail, for example concerning payment services' accessibility for all groups in society, resilience to shocks, preparedness and equal treatment regardless of geographical location. However, ensuring the private market delivers on all these points would demand major resources, according to Skingsley.

More detailed analysis required

It is still too early to determine whether or not the Riksbank should issue an e-krona. Skingsley emphasised that analysis needs to continue concerning both the e-krona's design and its effects, but that the consequences of a completely privatised payment market also need to be analysed carefully. By starting the analysis, we have made sure we stand better equipped should cash be marginalised further in the future, Skingsley concluded.

Updated 22/11/2018