At the BIS website I noted this speech given by Stefan Ingves, Governor of the Sveriges Riksbank, to the first meeting of the so-called cash management advisory board in Stockholm (26 April 2006). This board will meet twice a year to discuss cash-management issues in Sweden and its members are: banks, cash-in-transit companies, representatives of the retail trade, trade unions and authorities such as Finansinspektionen (the Swedish Financial Supervisory Authority), the police and the Swedish Work Environment Agency.
As a sort of kick-off for further discussion in Sweden, the Governor describes the situation in Nordic countries with respect to usage of cash and preferred pricing policy:
I think that we should ask the question of why Sweden has so many more cash transport robberies than other countries, not just other Nordic countries, but the majority of European countries. There have occasionally been suggestions put forward in the general debate that if one tried to reduce the use of cash in society, the number of transports to ATMs could be reduced. Given this, it is interesting to reflect on why we Swedes prefer to pay by cash rather than by card more often than our Nordic neighbours. The number of card transactions per inhabitant in 2003 was around 130 in Norway, just over 100 in Finland and Denmark and just over 80 in Sweden. There is no clear explanation for this, but one clue may lie in pricing. In Sweden, cash withdrawals from all ATMs are free of charge, despite the large costs entailed in cash handling. In the other Nordic countries, cash withdrawals are only free of charge from the customer’s own bank’s ATMs, which has led to a reduction in the use of cash.
Well, it's nice to find out that there are still central bankers that dare to include cost of criminality into the calculations of (social) cost of cash. And that they are not afraid to draw the appropriate (cost-based pricing) conclusions.
