Sweden, a trailblazer in the realm of digital payments, offers an array of options that have revolutionized how transactions are made.
With cash transactions dwindling, the Swedish economy increasingly relies on mobile and digital payment platforms that offer convenience, speed, and security. This blog post will explore some of the most popular payment methods in Sweden, including Swish, PlusGirot, and the growing trend towards a cashless society.
Based on the information provided, the five main payment methods in Sweden as of 2023 are:
1. Card Payments
Debit and credit cards are the top payment methods used in Sweden, both in-person and online.
The country's central bank, Riksbank, reported that 59% of transactions in 2021 were card transactions, with debit cards making up 84% of those transactions. Mastercard and Visa are the top two card issuers, with Mastercard holding 59% of the market share, followed by Visa with 39% of the market share.
2. Bank Transfers
Bank transfers account for nearly 32% of all online transactions in Sweden, making up a larger proportion of the overall monetary value of transactions.
The most common method to initiate these transfers is Trustly, although Nordea is also used, albeit less popularly. PlusGirot (formerly PostGirot), is a Swedish money transaction system owned by Nordea. PlusGirot is one of two proprietary clearing systems used for regular transactions like bill payments in Sweden. Historically separate from the banking system, it was later merged, enabling it to take deposits and conduct transactions with other banks .
Swish is a Sweden-based mobile app that allows users to connect their bank accounts to their phone numbers and make direct payments.
In 2021, it accounted for 13% of all transactions, and its usage has been on the rise. In fact, as of 2020, mobile payment system Swish overtook cash as a payment method in Sweden. Swish is a prominent mobile payment system in Sweden that has transformed how Swedes conduct financial transactions. Launched in 2012 by six major Swedish banks in cooperation with Bankgirot and the Central Bank of Sweden, Swish has become a popular choice, amassing 8 million users by July 2022.
The service links a user's phone number to their bank account, enabling instant money transfers.
It is used for a variety of transactions, including those at flea markets, church services, and small events where a credit card reader would be impractical. Swish was initially intended for transactions between individuals, but it has expanded to include businesses and organizations. The payment service has become popular for web-based sales, and it's even used by major corporations like train operator SJ. Payments can be made by scanning a QR code.
4. Klarna – Buy Now Pay Later (BNPL)
Klarna is one of the largest players in the Buy Now Pay Later (BNPL) industry and was founded in Sweden in 2005.
BNPL services have seen a rise over the last decade, and Klarna remains the top BNPL option for most Swedes.
Despite Sweden being one of the most tech-forward payment atmospheres, cash still plays a role in transactions.
Although card payments and digital payments have increased over the years, as of 2019, the market share of cash transactions in Sweden was around 12%. There are still sectors of the population that prefer or rely on traditional methods of payment. The country's shift towards digital transactions has not been without its challenges. However, the Swedish experience provides valuable insights into how societies can adapt to digital payment methods.
These are the most common forms of payment, but it's important to note that their popularity can change quickly due to new technologies and societal trends.
The popular payment methods in Sweden reflect the country's advanced digital economy and the people's willingness to embrace new technologies. While services like Swish and PlusGirot provide convenient and secure options for transactions, the overall trend is a move toward an entirely cashless society. However, ensuring that this digital revolution is inclusive for all Swedes, including the elderly and those without access to digital technology, remains an ongoing challenge.
Nonetheless, Sweden's innovative payment methods position it as a model for countries worldwide looking to modernize their own financial systems.