Cash will be taken out of circulationThe phasing in of new bank notes renders bank notes older than the 2009 series with depictions of bridges and prehistoric finds invalid as of summer next year. If people still have old notes lying around, they should hurry down to the bank to exchange them for newer ones. And as far as the thousand kroner note is concerned, it will have to be exchanged for smaller notes.
“But typically, most people won’t go to the bank to exchange their old bank notes for new ones. Instead, they’ll put the money into their bank account. And then most of them won’t return to withdraw the money again. On the contrary, they’ll use the money digitally. Which means that lots of cash will be taken out of the cash flow. We saw the same thing when Sweden introduced new bank notes back in 2015-2016,” Jonas Hedman explains.
The banknotes are being replaced for security and quality reasons, but Jonas Hedman does not expect the new banknotes to take up much space in many trouser pockets.
“Bank notes will be around for a long time because there is no political desire to terminate them. But in a few years, cash will have next to no practical function in society. Personally, I believe that bank notes will only play a part for small niche groups,” the researcher elaborates. He also has a request.
User-friendly solutions are requiredHe calls for better digital payment methods than the current ones. Solutions that take into account those who do not have MitID, are digitally weak or have a physical disability that prevents them from paying with a card or mobile phone.
"We should develop an alternative to MitID. A more user-friendly solution than the current one. And preferably one that is also robust in the face of crises," he says.
Recently, the risk of a hacker attack on the power supply or the internet has become part of the discussion about the cashless society. But for Jonas Hedman, that part is not so important.
"Fortunately, the likelihood of the power going out across Denmark for several days is very small. But if it were to happen, your tinned tomatoes and your friends would probably be worth more than cash. Because favours from friends and the ability to borrow small items would be more effective than a little cash," he says.
Very little experienceJonas Hedman points out that an alternative market with high prices would probably emerge as supermarket shelves became empty.
He also points out that the stores' electronic doors, freezer counters and lights would not work either.
"But we have very little experience of these kinds of crashes in Western societies," he says.
However, if the internet is hacked, both cards and cash can be used to a certain extent. In Denmark, it is possible to make offline payments with credit cards. Denmark's National Bank has previously estimated that with moderate consumption, we will be able to pay offline with credit cards for around 10 days.
