- Hide menu

Cashless Society a Comparison of America and Sweden

I’m astounded, why America haven’t foregone the precious paper checks. When my husband visited the “States”, in 2001, he couldn’t understand why people were writing checks for groceries or bills. He was especially dumbfounded, when my internet banking didn’t have an electronic connection to certain payers, such as condo fees and etc, and sent paper checks (on behalf of the client). Well, the consumer definitely saves a couple of bucks on postage stamps, however, pays higher bank fees because of these paper promissary notes.

America is one of the advance countries, so why are we last in eliminating this culture norm? Just recently, I read an article on the NY Times website, that America is nearing talks about abolishing this ancient ritual around 2012. What are your thoughts? Also, do American’s know what a Bank GIRO, IBAN or Auto GIRO and etc.?

SWEDEN’S VIEW: According to Sweden’s Riksbank, Cheques have disappeared in the early 1990

QUOTE FROM Deputy Governor Lars Nyberg:

Cheques have disappeared: “As I said, card payments have begun to replace cash payments of smaller amounts. They have also replaced a large number of cheque payments in Sweden. In 1990 every seventh transaction was paid for by cheque. Cheque payments accounted for just over one-tenth of the value of non-cash payments. Today cheque payments account for just some tenths of a per cent of both the value of the payments as well as the number of transactions.

The death of the cheque in Sweden is of interest, for it was quick and unexpectedly painless. The story is as follows: Over time cheque handling became increasingly unprofitable for the banks. The costs increased, but none of the banks dared take the initiative to debit customers for these costs. There were concerns that Swedes regarded payments by cheque as an inherited right and would, therefore, vocally protest. But this was not the case. When, at the beginning of the 1990s, one of the banks decided to charge a fee of SEK 15 per cheque (and the others followed suit) the majority of cheque payments disappeared over just a few years – and moreover without political convulsions. The reason for this was that there were excellent substitutes that were free of charge and which were marketed by the banks, primarily cards and credit transfers. When consumers discovered this, their grief over the death of the cheque abated.

The United States has always been the promised land of the cheque. By tradition, US consumers have sent cheques in the post when they pay their electricity or telephone bills, for instance. The company receiving the cheque has then forwarded it to the bank, which has then transferred the money and returned the cheque to the consumer. In this manner, tons of cheques have crossed the American continent daily. But even in the United States cheque usage has begun to fall.” TOO READ MORE, VISIT: http://www.riksbank.com/templates/Page.aspx?id=26857

Comments are closed.