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Sweden Launches E-krona Feasibility Review

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Sweden’s central bank, the Riksbank, has edged another step closer to launching its much anticipated central bank digital currency (CBDC), dubbed the e-krona – with a lengthy government review of the consequences of a national CBDC rollout beginning today.

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Back in February this year, Sweden gazumped many of its European and intercontinental counterparts by announcing that it had begun testing the e-krona, which makes use of blockchain technology. The Riksbank has been working with technology provider Accenture on its token.

And in a new development, Bloomberg reported that Per Bolund, Sweden’s financial markets minister, has officially launched a feasibility review into the e-krona. The review will probably be complete by late November 2022, and will be spearheaded by Anna Kinberg Batra, the ex-chairwoman of the Riksbank’s finance committee.

The country has remained firmly agnostic about whether or not it will go ahead with the CBDC issuance, with the central bank stating categorically on its website that “no decisions have yet been taken on issuing an e-krona.”

However, the central bank governor Stefan Ingves wrote, back in mid-October, “There shall be digital state money as legal tender, an e-krona, issued by the Riksbank.”

Ingves will still need to convince both the Riksdag (the Swedish Parliament) and the government of the wisdom of the move, but has already submitted a proposal to parliament this year, asking it to appoint a panel of experts to judge the e-krona feasibility.

The Swedish government has taken pride in the fact that the Bank for International Settlements (BIS) declared in 2018 that the nation was the world’s most cashless region. The central bank claims that 90% of all monetary transactions in the nation are done completed without the use of cash.

Bloomberg quoted Bolund as stating,

“It’s crucial that the digitalized payments market functions safely, and that it’s available to everybody.” Depending on how a digital currency is designed and which technologies are used, it can have large consequences for the entire financial system.”

However, as reported, over the past few years Swedes have been increasingly concerned about the elderly, those living in rural areas and people from migrant backgrounds being left behind by businesses switching to Swish no longer accepting cash.

Last year all but one of Sweden’s political parties supported new laws requiring Sweden’s major banks to continue to offer cash services across the country.
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