Street performers and homeless people who make contactless payments. Shops, cafes and restaurants that no longer accept cash. Parishioners who make digital donations to their churches instead of throwing bills or coins in a collection plate.

These scenarios are fast becoming a reality in the countries that lead the shift towards a cashless future. However, an independent report on the use of cash published in the United Kingdom finds that the rush to embrace digital payments runs the risk of leaving people behind, especially the most vulnerable in society.

According to the report, the researchers spoke with central banks, consumer groups and a committee of all parties in Sweden, considered the most advanced society in the world as far as cashless is concerned. The report places special emphasis on the importance of immediate planning to include everyone in the digital economy.

Half of Swedish retailers expect to stop handling cash in 2025. Already last year, IKEA tested its first store without cash. Cash in circulation has been reduced to only 1% of GDP.

This means that a fifth of the Swedes no longer withdraw money and only 13% reported having used it in a recent purchase, compared to 40% in 2010.

Around 85% of transactions in Sweden are made by card, online or by a payment application for smartphones. The use of cash has been falling so fast that the Deputy Governor of the Central Bank of Sweden (Sveriges Riksbank) Cecilia Skingsley predicted that the country is likely to run out of cash within three to five years.

Social costs

In the midst of the great number of benefits of digital payments (its ease of use, the potential to reduce costs for businesses, decrease tax evasion, corruption and organized crime), there is growing concern for those who do not have cards or bank accounts. This population in particular, has difficulties to use smartphones or computers and therefore to access the bank and make payments, since among other limitations many lack data in their mobile connectivity.

Retirees, recent immigrants, people with disabilities or people living in rural areas are especially vulnerable. Then, while looking for solutions, the Central Bank of Sweden has demanded that all banks continue to offer cash services.

The report, called Access to Cash Review, says Sweden’s experience “describes the dangers of sleepwalking in a society without cash: millions of people could be left out of the economy and face greater risks of isolation, exploitation, debt and rising costs. “

Alternatives to problems

A possible option for Sweden is the e-krona, says Skingsley, which consists of a digital currency, with a 1 to 1 conversion with an ordinary Crown in an account in the Riksbank or stored locally in a card or mobile application. The technology is already available.