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Discard All Bills Larger Than 50kr ($6)
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| St_Andrew |
So today "The Swedish Financial Supervisory Authority" (Finansinspektionen) started a debate in Sweden. Unfortunately I couldn't find any English article about it (yet), but I will explain their idea roughly here:
Their idea is that we should discard all banknotes with a value higher than 1000kr (120 USD) immediately, then the 500kr (60 USD) and 100kr (12 USD) as soon as possible. This would leave us with no higher value than the 50kr banknote (6 USD).
The idea with this is to stimulate people to use their bankcards. Today it is free to withdraw money in all ATMs in Sweden, while they sometimes take a fee for shopping in stores with cards. If you look at bank operating costs though, the banks have A LOT higher costs for operating the ATMs than the debit/credit card system.
It is estimated that the moving around of money (ie from stores, to ATMs to banks etc) costs about 11 billion SEK every year (1.33billion USD)... And not only this, there is also a huge human cost for handling the money, we have had huge problems with robberies of transports and also robberies of stores with too much cash.
Also, most if not all criminal activities are done by cash, with only the 50kr bill, large amounts of money would be hard to handle for these people.
By making it harder to use cash, at the same time as you make the consumers pay for what really does cost, you would increase the use of credit/debit cards which would make it better for everyone in the long run.
Great idea imo, and I guess the situation is similar in most countries so this would of course not only apply to Sweden. |
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| Shakka |
| Debit cards are great, but do you really need a government to force people to choose how they access their own money or remit payment? Yay debit cards. They also carry lower interchange fees. Down with Amex! |
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| Yoepus |
you realize this is bascially a lobbyist effort?
Afterall merchants are charged fees from 1-5% of the transaction plus typically a flat 5-35 cents, monthly fees, and equipment fees. There is no difference whether it is debit/credit.
Additionally not all merchants can accept CCs as they don't meet the credit card companies requirements.
Furthermore security is no less of an issue (there have been numerous large scale CC thefts from merchants).
And I think it would obsolete many interpersonal transactions, i.e. a bought a ticket for a friend and now how will he pay me? By check??
Lastly, what about the tourists? |
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| ali92 |
Good luck, Sweden. I hope the people in that country don't have to deal with identity theft and credit card fraud as much as it happens in teh US. I would never vote for such a thing, as every time you use a credit card or any of these types of cards, there's a 'paper trail' (well, it's now computerised, but the term still sticks) that logs what your money goes into (like what you buy, etc).
Privacy advocates wouldn't like a card-only system in place at the current time... |
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| St_Andrew |
| quote: | Originally posted by Yoepus
you realize this is bascially a lobbyist effort?
Afterall merchants are charged fees from 1-5% of the transaction plus typically a flat 5-35 cents, monthly fees, and equipment fees. There is no difference whether it is debit/credit. |
Well yes it is. Debit cards (at least in Sweden) doesn't cost any percentage for the stores, I'm not sure about the flat rate though.
Point with this article though is that this would make it more fair, since now the credit/debit card users are paying for the ATMs as well. So if the banks could take fees for card as well as ATM transactions proportionally to what it costs instead, that would make it cheaper to pay with credit/debit.
| quote: | | Additionally not all merchants can accept CCs as they don't meet the credit card companies requirements. |
That's a problem though, I donno what these requirments are though?
| quote: | | Furthermore security is no less of an issue (there have been numerous large scale CC thefts from merchants). |
Never happend here. But we lose like a couple of hundred millions SEK each year in cash robberies so I think those would not be higher. Besides, Credit/debit card companies here are soon starting with a new technology instead of the old magnet cards. Also it is a lot more common here that you use a PIN-Code for you credit/debit card when you buy something, and if the store doesn't have one of those card readers that can check PIN, then they usually check IDs. So I would say generally it's A LOT harder for credit card thefts here than in the US where you only need a signature to go through with a credit card transaction.
| quote: | | And I think it would obsolete many interpersonal transactions, i.e. a bought a ticket for a friend and now how will he pay me? By check?? |
You could still use the 50kr bills.
And besides, even today I would pay any larger sums (to friends too) over Internet banking (we have a really awesome working system for inter-bank transactions in Sweden).
| quote: | | Lastly, what about the tourists? |
Tourists never bring their VISAs? |
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| Sunsnail |
| I say no... I feel that cash is too important |
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| ali92 |
| quote: | Originally posted by Sunsnail
I say no... I feel that cash is too important |
I agree. It would be different if about 90 % of the society in question used some form cards for _all_ payments, but this is hardly the case yet. Anyone who says it is, I couldn't see believing it yet (think about it: every _single_ time you exchange money for something, is it by card/electronic payment system?). |
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| Shakka |
| Don't you see? This is just the stepping stone to taking paper money out of the system and going digital altogether. If they can get you hooked on your debit cards, nobody'll need to carry cash and paper money will be obsolete! Oh brave new world! |
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| malek |
two words
good luck |
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| Lover Boy |
| quote: | Originally posted by Shakka
Don't you see? This is just the stepping stone to taking paper money out of the system and going digital altogether. If they can get you hooked on your debit cards, nobody'll need to carry cash and paper money will be obsolete! Oh brave new world! |
+1
Roll on the digital age, let the government know every single item you buy! The only problem is, I can't see dealers accepting cards anytime soon... |
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