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Sweden 2025

Market Overview
Payment Organisations BDB Bankernas Depå.

Bankomat AB manages the Bankomat ATM network.

Getswish AB operates the immediate payment service, Swish.
Domestic Payment Brands No domestic card brand.
Swish, the immediate A2A payment service of the Swedish banks.
Market Structure Swedish debit cards are branded Mastercard, VISA, Debit Mastercard, Maestro, VISA Debit or Electron.

With 378.7 payments per capita, card use in Sweden is above the EU average.

Swedish banks focus both on cards and account-based payment services, including digital A2Apayment services such as Swish.

Nordea, Handelsbanken, SEB, and Swedbank are the leading banking groups in the Nordic and Baltic regions.

Swedbank and NETS are among the 10 largest acquirers in Europe ranked by transaction numbers.

Emerging Open Banking payment ecosystem.
Notable Market Trends Contactless cards and POS/MPOS terminals, mobile payment apps, digital wallets, immediate A2A payments app Swish.

Recovery from the COVID-19 pandemic saw a massive 68% increase in the number of remote payments in 2021.
Major Card Issuers Swedbank, SEB, Svenska Handelsbanken, Nordea, EnterCard.
Major Card Acquirers Swedbank BABS, Worldline (Bambora), Handelsbanken, Nexi.
Major Card Processors TietoEVRY, Nets (Nexi).

Key Statistics 2023
Population 10.52 million, with 1.73 cards per capita.
Card Payment Functions Debit: 11.20 million

Delayed debit: 0.53 million

Credit: 6.42 million

Total: 18.16 million, including 17.11 million cards with a cash function
Card Payments  Debit 3.25 billion; value SEK 922.3 billion (€80.35 billion)

Delayed debit 46.3 million; value SEK 40.9 billion (€3.56 billion)

Credit 569.6 million; value SEK 282.5 billion (€24.61 billion)

Total 3.98 billion; value SEK 1,306.3 billion (€113.80 billion)
POS Terminals 207,935
POS Payments All cards: 3.04 billion; value SEK 965.0 billion (€84.07 billion)
ATMs 2,049
ATM Withdrawals All cards: 50.5 million; value SEK 72.1 billion (€6.28 billion)
Digital A2A Payments Credit Transfers: 2,211.9 million, value: SEK 23,742.1 billion

– thereof Swish: 1,010.0 million, value SEK 507.0 billion

Direct Debits: 520.63 billion, value: SEK 822.1 billion
Note: Italic forecast figures for 2024F are estimated in the payment market context based on 2023 figures.
Source: ECB, Sveriges Riksbank.

General Note – ECB changed its statistical reporting

In the 22nd Edition of the Digital & Payment Card Yearbooks there were some statistical reporting changes to address. The statistical data for 2022 was based on the new ECB regulation ECB/2020/59, which replaced the ECB reporting statistics regulation from 2013 up to 2021 (ECB/2013/43), the well-proven ECB bluebook reporting was discontinued.

For 2022, the ECB declared all data as provisional, because the first-time reporting under the new standard may have include errata and double counting.

The researchers and editors worked hard in the 22nd edition to balance out any obvious errata, but it remains that in some instances the data from 2022 cannot be compared to 2021 and previous years.

Where this has occurred, we have clearly stated it and have added explanation to the table and text.

In this, the 23rd Edition we have clarified any errata and filled in all missing data from the previous year.

Introduction – Payments in Sweden

Sweden is a constitutional monarchy and parliamentary democracy consisting of a unicameral parliament. Sweden ranks as one of the highest per capita income economies in Europe, and joined the European Union in 1995, but has not yet joined the euro zone.

Recognised as one of the most advanced non-cash payments markets in the world, Sweden has pursued a proactive strategy of reducing cash usage, although it has mandated access to cash services as of January 2021 to ensure all consumers have access to a wide array of payment methods.

The mobile instant payment service Swish is a key driver of digital payment innovation in Sweden and has overtaken usage of cards in some sectors. Development of mobile services are aligned with digital ID and authentication services like BankID, allowing citizens to access public services, online banking services, and other digital initiatives.

The adoption of the revised Payment Services Directive, PSD2, and disruptive technologies have set the stage for digital payments for the digital economy in Sweden. They have accelerated digital payment transformation and mobile payment services, as well as cardless IBAN-based payments directly from bank accounts.

In the last decade, Swedish consumers have embraced mobile devices such as tablets, smartphones and Internet of Things (IoT). This change significantly impacts their shopping experience. Consumers have become increasingly connected and they have started to purchase anywhere, at any time, from any device.

In addition, new consumer demands are a game changer. Swedish consumers like digital banking apps with access to all their accounts at different banks in one single app, with the option to make payments directly from their bank account of choice. Additionally, they appreciate more banking services and payment services added to their mobile banking app. Consumer adoption of digital payments in Sweden is driven by minimal cost, secure payments and a high level of user convenience.

Driven by the development of social media and mobile devices, the emergence of permanently connected consumers has impacted their interactions with brands but also their expectations of how to shop using the increasing number of touch points between consumers and merchants, e.g.:

The ongoing rollout of a mature online and mobile communication infrastructure is an enabler for digital card payment transformation and for Open Banking payments in Sweden.

In a few years from now, mobile banking apps and mobile payment apps are expected to combine account management, digital payment services, personal finance management and value-added digital services from location finders to digital vouchers.

Cash payments, card payments and cardless payments directly from bank accounts (A2A payments) remain all relevant for Swedish merchants and are heavily used by Swedish consumers.

This country profile provides an introduction into two competing payment ecosystems in Sweden:

Legal Framework for Payment Services

The legal framework for European payment services is a joint project undertaken by the European Commission as the regulator, the European Central Bank (ECB) as the Euro System, and the European Payments Council (EPC) with the objective of standardising payments in Europe and to remove existing barriers, promote cross-border competition between payment services, strengthen the European internal market and drive the digital payment transformation.

Based on its vision, the EU Commission has therefore created a unique legal framework for cashless B2C and B2B payments that supersedes pre-existing national legislation and is binding for financial service providers and payment service providers throughout the EU.

Sweden has largely transposed this legal framework into their national payment legislation.

Historically, there has been a de facto national regulation of all Swedish payment schemes with high technical barriers to ensure and defend payment security.

With the implementation of the payment services directive, all payment services in Sweden are based on the unique legal framework for payment services of the European Commission effective in the European Economic Area (EEA).

In addition, the respective rules and regulations of the domestic card scheme and the international card schemes continue to be applied by the card payment service providers (e.g. EMV, PCI, RTS SCA, and SEPA Cards Framework), respectively.

Legal Framework relevant for Payment Services in Sweden

The revised Payment Services Directive, PSD2, had established a legal and regulatory framework for payment services providers, enforcing several protections for their clients such as safeguarding of funds; and required them to execute processes in accordance with banking regulations, such as KYC and AML. It has already resulted in significant progress regarding the integration of the European retail payments markets.

Following the alignment with the EEA region, the legal framework for payment services in Sweden includes the directives and regulations of the European Commission (EC), the ECB, and/or the national central bank (NCB) of the individual country.

All card payment service providers and all cardless payment service providers of the Open Banking payment ecosystem must apply for the European legal framework including:

Revised Payment Services Directive (PSD2)
PSD2 is the key directive for borderless banking and payment services in Europe.
Among others, PSD2 regulates digital payment services and payment service providers such as payment institutions, e-money institutions, payment initiation service providers and account information service providers. PSD2 formulates the Open Banking Mandate for regulated access to payment accounts.

General Data Protection Regulation (GDPR) – effective from May 2018
GDPR establishes a regulatory framework for customer control of their data through consent mechanisms, the right to be forgotten and the right to retrieve all personal data for re-use at other service providers of choice, thereby preventing a ‘lock-in’ situation.

E-Money Directive (EMD)
The EMD sets out the rules on the business and supervision of e-money institutions.

Anti-Money Laundering Directive (AMLD)
The AMLD6 aims to improve the harmonisation of the criminal liability of money laundering and terrorist financing across the EU27.

Customer Rights Directive (CRD)
CRD gives consumers the same strong rights across the EU. It aligns and harmonises national consumer rules, for example on the information consumers need to be given before they purchase something, and their right to cancel online purchases, wherever they shop in the EU.

EU Price Regulation for cross-border payments
In 2001, Regulation (EC) No 2560/2001, followed in 2009 by Regulation (EC) No 924/2009, fixed uniform underlying conditions for processing cross-border payments in euro, and the fees for intra-EU cross-border payments in euro were aligned with those for domestic payments in euro.

SEPA End-Date Regulation
SEPA payment instruments replaced domestic A2A bank payment instrument formats for euro payments.

Card Interchange Fee Regulation (IFR)
The IFR caps interchange fees for payments with consumer cards, effective from 9 December 2015. It increases transparency on fees thus permitting retailers to know the level of fees paid when accepting cards.

Domestic bank service laws
Complementary to EC directives and EC regulations.

Characteristics of the PSD2 Outlook: PSD3 and PSR

The adoption of PSD2 has formalised the relationship between banks and trusted payment providers (TPPs) by establishing the Open Banking Mandate providing open access to customer account data and the payments infrastructure. This is expected to stimulate the FinTech market to develop new integrated services models for both consumer and business customers.

This regulation is a reaction to the growing demand from customers as mobile and internet applications have become widely adopted, driving expectations in how services should be delivered across all industries. Other market segments have adopted Open Banking APIs to respond to this demand and shown that innovative applications can grow business and change customer behaviour.

PSD2 has a significant impact on the European payments industry. According to the EC, the revised Payment Services Directive brings several new important elements and improvements to the EU payment market e.g.:

In 2022, the regulator started a PSD2 review process, which will end up in a revised PSD2 dubbed PSD3. While consultations are currently ongoing, the revisions are expected to address the achievements of the PSD2 and evaluate the need for a revised standard.

Proposed EC Revisions to the EU Payment Services Regulation – PSD3 and PSR 

In June 2023, the European Commission (EC) has published its proposed revisions to EU payment services legislation, as well as a proposal on Open Finance/data access in the financial services sector beyond Open Banking/payment accounts in the form of a new Open Finance framework called “FIDA”.

Essentially, the EC is proposing that PSD2 would be split into two different instruments. These will ensure consumers can continue to safely and securely make electronic payments and transactions in the EU, domestically or cross-border, in euro and non-euro. Whilst safeguarding their rights, it also aims to provide greater choice of payment service providers on the market:

The objective of the regulation is to enhance harmonisation of the rules and enforcement across the various EU Member States. In addition, the EC proposed to merge the E-Money Directive (EMD2) with the proposed PSD3 and PSR texts, so as to have one coherent regime for both payment services and e-money services, and thereby ensure a level-playing field between PIs and EMIs.

PSD3 also amends the Settlement Finality Directive (SFD) in order to allow non-bank PSPs (e.g. PIs and EMIs) to participate directly in SFD-designated payment systems. Fintechs will be given access to all EU payment systems, with appropriate safeguards, and giving them a right to have a bank account. That way, those non-bank PSPs would no longer need to rely on banks in order to execute payment transactions.

A system to check IBANs and a platform to enable payment service providers to share fraud-related information are two proposals around consumer protection, including an extension to all credit transfers of IBAN/name-matching verification services. These have been proposed by the Commission for instant payments in Euro. All consumers should benefit from them, for both regular and instant credit transfers.

The European Banking Authority (EBA) is given once again a number of mandates under PSD3 and the PSR to prepare draft regulatory technical standards (RTS) and draft implementing technical standards (ITS), ultimately to be adopted by the EC, as well as guidelines, and to continue maintaining the register.

In 2024, significant progress was made in updating PSD2. In April 2024, the European Parliament adopted the European Commission’s proposals for PSD3 and PSR at first reading. While the exact timelines for enforcement are not yet confirmed, it is anticipated that the finalized versions of PSD3 and PSR may become available by late 2024 or early 2025.

General Data Protection Regulation (GDPR) 

The General Data Protection Regulation (GDPR) is a legal framework that sets guidelines for the collection and processing of personal information from individuals who live in the European Union (EU). Since the Regulation applies regardless of where websites are based, it must be heeded by all sites that attract European visitors, even if they don’t specifically market goods or services to EU residents.

Adopted in April 2016, the Regulation came into full effect in May 2018, after a two-year transition period. The GDPR replaces the Data Protection Directive 95/46/EC and is designed to:

The GDPR mandates that EU visitors to all websites must be given a number of data disclosures. Sites must also take steps to facilitate such EU consumer rights as timely notification in the event of personal data being breached (breach notification). Among others, the GDPR mandates the user’s right to access their data and the right to be forgotten. In addition, the conditions for consent have been strengthened, and companies are no longer able to use long, illegible terms and conditions full of legalese. Also, it must be as easy to withdraw consent as it is to give it.

eIDAS Regulation and Digital ID Trends

The electronic Identification, Authentication and Trust Services regulation (eIDAS) is a set of EU standards and regulations for electronic identification and trust services for electronic transactions in the European Single Market. It was established in the EU Regulation as of 23 July 2014, relating to electronic identification, and repeals directive 1999/93/EC from December 1999. It entered into force on 17 September 2014 and applies from 1 July 2016 except for certain articles, listed under its article 52.

In June 2021, the European Commission proposed an update to eIDAS that will enable every European to have a set of digital identity credentials recognised anywhere in the EU. With eIDAS 2.0, by 2024, all EU member countries must make a digital identity wallet available to every citizen who wants one. However, full deployment may extend beyond 2024. Large-scale pilot projects aimed at testing various use cases, including governmental services and digital travel credentials, are underway and will continue through 2025. These pilots involve both public and private stakeholders across multiple countries. The official rollout of the wallet for common use may take until 2026. Many digital ID schemes operate based on super-secure passwords and/or mobile apps confirmed by a second factor, either passwords or one-time token or biometric factors such as fingerprints.

Digital ID in Europe has been proliferating rapidly in recent years. To date, both the nature of these schemes and their application have varied widely – for example, BankIDs in the Nordics being used to support instant payments and the delivery of harmonised government services.

eID platform initiative – In May 2017, a group of European companies including banks, vehicle manufacturers and technology providers signed a “corresponding declaration of intent” to establish a joint, pan-industry platform that will let their customers use a so-called “master key” for registration and identification when accessing online services across a range of sectors including government, aviation and retail.

Biometric Authentication Services

As a form of digital identity, biometric factors have been gaining ground across Europe in recent years, especially since the EU mandated their use for national ID cards and passports from August 2021.

In the payments industry, European banks and other account servicing payment service providers (ASPSPs) have started to support new biometrics technology companies that will develop client identification and authentication systems. They will be dedicated to the research and development of software for the digital verification and authentication of personal identity, through facial, voice, image or document recognition, or fingerprint reading.

With the EU regulator’s decision to mandate Strong Customer Authentication (SCA) as part of the revised payment services directive, PSD2, biometric authentications look set to grow further in importance as part of the payments landscape.

Companies such as Sweden’s Fingerprints (for online payment ID) and the UK’s Fingopay (for physical payments) have pioneered their use in P2P and P2B transactions, while some national ID schemes such as BankID in the Nordics and nemID now include biometric factors alongside PIN in their log-in processes.

Among others, in 2024, payments-specific biometric initiatives and pilots in Europe include:

BankID – BankID is an important element of the Swedish payment system and helps banks to maintain a high level of security. Although the BankID online identification and signature service was developed for banks, it is also used to log in to several public service portals and for online purchases from non-financial firms.

BankID uses a combination of hardware-based authentication (key fobs) and one-time-password generation for authentication. In the mobile environment, Mobile BankID is stored on a smartphone. BankID on card requires a card reader with a card connected to a PC. Users can set up a personal password linked to their BankID and use the same password every time to authenticate for a service.

From 2021, the vast majority of Swedish bank customers had the opportunity to activate a BankID e-identification at their bank, with 10 Swedish banks offering BankID to their customers. About 8.4 million Swedes have a BankID, most of them on their mobile phones. As a percentage of Swedes between the ages of 18 and 67, this means that 99.2% have one (or more) BankID.  Seven out of 10 use mobile BankID every day and 7 out of 10 pensioners use Mobile BankID, half of whom do so daily. The number of times of use, identification, and signature, with BankID amounted to 6.7 billion in 2022. BankID is used in services by 6,150 organisations, including the majority of Swedish authorities, regions, banks, and companies within most industries, not least payment services.

In 2023, the number of BankID users increased to about 8.5 million, with 99.4% of Swedes between the ages of 18 and 67 having one (or more) BankID. The number of times of use, identification, and signature with BankID amounted to 7.1 billion in 2023. BankID is used in services by 7,100 organisations, including the majority of Swedish authorities, regions, banks, and companies within most industries, not least payment services.

Mastercard Identity Check – In October 2016, Mastercard launched its biometric payment authentication service, Mastercard Identity Check Mobile, to 12 European countries. European consumers can now validate online purchases using 2-factor authentication such as one-time codes sent by SMS or fingerprints in their mobile app.

Nordea e-Invoicing Messenger service – In November 2017, Nordea and NETS launched an e-invoicing service which enables consumers to post invoices and pay their bills via Facebook Messenger. The service, which requires a Bank-ID and mobile security PIN, is fully automated and the payment is initiated via an online dialogue with a chatbot in Facebook Messenger.

Banking Sector

Sveriges Riksbank (SRB) is the national central bank and supervises the Swedish banking system together with Finansinspektionen (FI), the Swedish Financial Supervisory Authority. The legal framework in which Swedish financial institutions and companies operate is based on EU directives and Swedish banking laws. The Payment Services Directive (PSD) became effective in Sweden as of 1 July 2010.

Despite the heavy involvement of its banks in the hard-hit Baltic region, the Swedish economy recovered swiftly from the global credit crunch, with growth reaching 6.1% in 2010 and the lowest deficit in the public sector in the EU.

In 2020, after several years of consistent growth, the COVID-19 pandemic brought about a sharp break in the trend. GDP fell by 4.0% in 2020, while inflation, which had been close to the target of 2% for a few years, fell heavily and averaged 0.5% over 2020. A large part of monetary policy measures were aimed at ensuring that the continuous, functional credit supply, and that interest rates remained low. In 2021, there was a strong recovery with GDP rising by 5.1% and growth normalised to 2.6% in 2022. Inflation rose in 2021 and averaged 2.4%. Monetary policy in 2021 focused on supporting the economic recovery and bringing inflation consistently close to the inflation target. By the end of 2022, inflation in Sweden worsened to 8.37% due to the effect of Russia’s invasion of Ukraine. In 2023, Sweden’s economy contracted slightly, with GDP declining by 0.2%, primarily due to tightening monetary conditions and weakened domestic demand. Sweden inflation rate for 2023 was 8.55%, a 0.18% increase from 2022.

In 2015, Sweden adopted a symmetrical rounding policy to eliminate 1c and 2c coins. When consumers get change in cash in shops, the amount of that change will be rounded to the nearest 5 cent coin to reduce the need for 1 cent and 2 cent coins. Other EU member states applying a symmetrical rounding policy include Belgium, Denmark, Finland, Hungary, Ireland, and the Netherlands.

On 4 November 2014, the European Central Bank (ECB), via the Single Supervisory Mechanism (SSM), assumed the responsibility of supervising the financial stability of banks operating within the euro zone. However, while the ECB has final supervisory authority over all banks operating within the euro zone, it will only directly supervise those banks classified as ‘significant’ under the terms of the SSM (by September 2024, 113 significant banking groups have been recognised). All other ‘less significant’ banks continue to be supervised by Finansinspektionen.

In March 2016, the Swedish Riksbank said that access to cash should become a legal right for Swedish consumers and banks should have a duty placed on them to provide cash services as a basic feature of payment accounts.

Structure

In 2023, the country had 124 banks of which 42 were Swedish banks, 36 foreign banks’ branches, 44 savings banks, and two cooperative banks. There were also 16 representative offices of foreign banks in Sweden.

Between December 2000 and December 2023, the number of commercial banks operating in Sweden increased from 22 to 42. This rise was due both to an increase in the number of foreign banks establishing themselves in the country, as well as to an increase in the number of niche commercial banks, such as internet and telephone banks, launching operations.

The Swedish banking sector is dominated by four commercial banks: pan‑Nordic Nordea, Skandinaviska Enskilda Banken (SEB), Svenska Handelsbanken, and Swedbank, with a collective market share of 75.7% in assets as of 2023. All four banks have developed a significant presence outside Sweden, most notably in the Nordic and Baltic regions.

The few non‑Nordic banks that have established a strong presence in Sweden tend to focus their activities solely in Stockholm. The largest foreign bank operating in the country is Danske Bank (DK).  In 2018, Nordea Bank moved its headquarters from Sweden to Finland, although it maintains significant operations in Sweden. Nordea’s balance sheet has now been included in our report on Finland.

Swedish banks have also turned their attention to cross-border M&A, mostly in the Nordic and Baltic regions. Seven Swedish banks own banks in at least one other country (see Appendix). For further information on Swedish banks in the Baltics, see the Estonia profile for Swedbank and the Lithuania profile for SEB.

1 – Leading Swedish Banks 2023

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Note: In October 2018 Nordea Bank moved its head office from Sweden to Finland.
Note: lending and deposits are to/from the public (households, companies, local government).
Source: Swedish Bankers’ Association.

SEB (Svenska Enskilda Banken) reported 135 branches and served about 4 million individual private customers, including about 1.3 million private and 292,000 corporate home bank customers in Sweden, and more than 1 million individual customers across the Baltic states. SEB reported 1,735 ATMs in 2023, compared to 1,829 in 2022.

The bank has expanded into Russia and Ukraine and has developed its credit card business, SEB Kort, throughout the Nordic and the Baltic regions. SEB continued to serve customers in its branch offices in Luxembourg, Poland, Russia, Ukraine, China, Hong Kong, Singapore, India, United States and Brazil. On the corporate side, SEB serves 2,000 large corporations, 1,100 financial institutions and 400,000 SMEs.

In August 2016, SEB invested in blockchain payments outfit Coinify (DK). In November 2016, SEB said it would use blockchain technology from Ripple to enable customers to make real-time intra-bank transfers between accounts in Stockholm and New York.

There have also been two disposals: SEB sold its retail banking interests in Germany to Santander for €555 million in 2011, and its Polish investment, Bank Ochrony Srodowiska, in 2006 after its bid for 100% control was rejected by other shareholders.

In 2023, the number of Swish payments conducted via SEB’s app rose to 191 million from 102 million in 2022.

Svenska Handelsbanken is a full-service bank for both personal and corporate customers and has a nationwide branch network in Sweden, the UK, Denmark, Finland, Norway, and the Netherlands. The bank regards these countries as its home markets. Handelsbanken, the least active of Sweden’s big four outside its home market, has also announced plans to expand into Poland; Handelsbanken acquired Midtbank of Denmark in 2001. Handelsbanken was founded in 1871 and has operations in more than 20 countries. Handelsbanken reported 206 branches in Sweden at end-2023.

In 2022, Handelsbanken decided to cease its operations in Denmark and Finland and initiated a process to divest these two business segments. In June 2022, Handelsbanken sold its operations in Denmark to Jyske Bank, including business relationships with private and corporate customers, 43 branches, and approximately 600 employees. The sale was completed in Q4 2022. In May 2023, Handelsbanken announced that it had agreed to sell parts of its Finnish operation to three local companies for about €1.3 billion and the deal is expected to close in H2 2024. The divestment of the SME operations has now been completed and the operations have been transferred to Oma Sparbank Abp. The transaction includes lending volumes of approximately €500 million, corresponding to a risk weighted exposure amount of approximately €170 million, and deposit volumes of approximately €440 million.

Nordea Bank Sweden, the region’s biggest bank, resulted from the amalgamation of Merita in Finland and Nordbanken in Sweden in 2000, followed by the acquisition of Unidanmark and Christiania, the second-biggest banks in Denmark and Norway (see Finland profile for more information on Nordea). Nordea reported 107 branches and 3.6 million customers in Sweden at end-2023.  It also reported 170,000 SME customers and 600 large corporate and institutional customers.

As at end-2017, Nordea’s Open Banking platform was launched when Finnish customer data was made available to third party developers. Nordea was one of the first banks in Europe to see the potential opportunities offered by the PSD2 regulations which require banks to open up to third parties to offer services to account holders. Since the launch of Open Banking, more than 2,500 developers have registered to test Nordea’s APIs.  The bank launched a new mobile banking app in Sweden (as well as other countries) in 2018.

In accordance with its strategy, Nordea is focusing on its business in the Nordic region and in March 2021 decided to wind down its operations in Russia, initiating a voluntary liquidation process, which was approved by the Central Bank of Russia on 16 April 2021. The voluntary liquidation process of JSC Nordea was completed in April 2022.

In 2023, Nordea continued to adhere to its policy of not conducting any business activities related to the regions of Donetsk, Luhansk, Zaporizhzhia, and Kherson, in addition to its existing policy for Crimea and Sevastopol.

Swedbank, the savings bank group, operates Sweden’s largest banking network, with about 4.1 million private customers, over 310,000 corporate customers, and 143 branches in Sweden plus 71 branches in the Baltics at end-2023. In May 2016, Swedbank launched its ‘Digital Banking in Swedbank’ unit in order to service its mobile banking clients. In 2023, the bank claimed a 34% market share in the Swedish payments market, with 3.5 million digitally active customers.

Cooperation with savings banks gives Swedbank access to an additional 200 branches. The branch network is complemented by teller services at a large number of retail stores. In 2014, Sparbanken Öresund was bought by Swedbank.

The group is dominant in the Baltic region through its Swedbank subsidiaries serving 7 million individual customers across Sweden and the Baltics.

EnterCard International, its joint venture credit card company with Barclays (40%) in the Nordic region, was formed in early 2005. There are now more than 2 million Entercard customers across Sweden and the Baltics. Swedbank reduced its shareholdings in SpareBank 1 Gruppen in Norway to 19% and in Aktia in Finland to 1% in 2005. In July 2007, it acquired TAS-Kommerzbank (UA), now called OJSC Swedbank.

In February 2021, Swedbank establishes a Baltic holding company headquartered in Riga, Latvia, where ownership of the current subsidiary banks in Estonia, Latvia and Lithuania was placed. In November 2021, Swedbank’s collaboration with the savings banks was renewed, meaning that the combined range of services and products reached a total of 6 million customers in Sweden in 2021.

In 2022, Swedbank entered into a strategic partnership with Sydbank A/S in Denmark and with Norway’s largest savings bank, Spare- Bank 1 SR-Bank to provide greater customer value through improved services for corporate clients in Denmark and Norway.

2 – Swedbank Group Key Figures

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Note: figures cover Swedbank Group – Swedish savings banks, partly-owned banks and all Swedbank operations abroad.
Note: digitally active customers are those that have made at least 3 log-ins to a digital channel in the last month.
Source: Swedbank.

Danske Bank – The fifth largest bank in Sweden, though a long way behind the big four, is Danske Bank, which acquired Ostgöta Enskilda Bank in 1997. Danske Bank reported 24 branches and 240,000 customers in Sweden at the end of 2023. In September 2015, Danske Bank concluded agreements with Swedbank on selling its personal banking businesses in Latvia and in Lithuania to Swedbank’s subsidiaries in the two countries.

In the savings banks sector, Sparbanken Finn merged with Sparbanken Gripen to form Sparbanken Öresund in 2010. In 2023, there were 44 local savings banks with 119 branches in Sweden.

As an open market, Sweden is subject to competition from institutions from other countries.

Retailer-owned banks – Thanks to supportive legislation, retailers are active in personal banking services, including card issuance and deposit-taking. ICA, the biggest supermarket chain, owns the ICA Bank venture (see also Retail Card section below). KF, the second biggest, runs banking operations as MedMera Bank, after the name of its reward scheme. IKEA owns IKANO Bank.

Digital Challenger Banks 

A number of digital challenger banks have entered Sweden, e.g. N26, Revolut and Wise (formerly TransferWise). They already have a clear Open Banking strategy in place.

In parallel, many Swedish banks co-operate and partner with trusted digital payment providers and FinTechs to prepare for the Open Banking ecosystem, enrich their digital banking services, and to offer additional mobile banking app features.

Nordea and FinTech Betalo – In February 2017, Stockholm-based payments start-up Betalo launched an international money transfer service up to eight times cheaper compared to other financial services. In May 2017, Nordea announced a partnership with Betalo for mobile payments expansion. Betalo’s mobile app enables consumers and small businesses to use their bank cards for domestic and international money transfers as well as to pay bills.

Nordea participates in marketing Betalo’s services, while Betalo has integrated the bank’s cards into its mobile app. Betalo has also partnered with other banks and card issuers in Sweden, including Ikano Bank, Santander Consumer Bank and online-only Lån & Spar Bank.  In 2018, Betalo rebranded as PFC (Personal Finance Co.)

Nodea’s partnership with Betalo follows a string of FinTech collaboration initiatives it has announced in the past four years. In 2017, the bank’s pensions and insurance arm, Nordea Liv, joined forces with Norwegian start-up Spiff to launch a mobile app for social saving, and in the same year launched the first version of its Open Banking portal targeted at FinTechs and other third-party developers.

Lunar Way – In October 2018, digital bank Lunar Way (DK) expanded into Sweden, furthering its ambitions to become a pan-Nordic alternative to the region’s traditional financial services institutions. Sweden became the fastest-growing market for Lunar, with 325,000 users registering for the service since receiving its European banking licence in August 2019. In April 2021 Lunar acquired Swedish marketplace lender Lendify, which has over 40,000 customers. In July 2021, Lunar announced it had raised €210 million in a Series D funding round including Heartland, Kinnevik and Tencent of China. In October 2021, Lunar Way announced the acquisition of payment gateway Paylike, enabling it to offer customers a one-stop checkout service for business customers.

In March 2022, Lunar Way raised €70 million in funding for the rollout of crypto trading and B2B payments products and announced plans to acquire Norway’s Instabank for €132 million. As of mid-2022, Lunar Way raised over €345 million in total funding, with a valuation of around €2 billion. It counts 500,000 customers across Sweden, Norway and Denmark.

In February 2023, Lunar raised €35 million to invest in and develop the business and reach profitability even faster and create even more value for customers. This funding round was part of a broader strategy to enhance their product offerings and expand their presence in the Nordic region. By the end of 2023, Lunar had successfully utilised the funds to launch several new features, including enhanced mobile banking services and expanded investment options. The company reported a significant increase in customer engagement and satisfaction, positioning itself as a leading digital bank in the region.

Northmill – In September 2019, Swedish consumer credit institution Northmill was granted a banking licence by the country’s financial regulator, Finansinspektionen. Northmill offers saving accounts, cards, and payments transfers to its 600,000 users. In February 2021, Northmill raised around $30 million in funding, with plans to be established in 10 European countries by 2023.

In 2021, Northmill was granted a license as a Visa principal, creating opportunities to issue and manage, without limitations, its own debit cards via Visa. Over the year, the merger between Northmill Oy of Finland and Northmill Bank was completed, and Northmill Oy was liquidated. The operations in Finland are now conducted through the branch Northmill Bank branch in Finland.

In March 2023, Finaro announced its European Cloud Commerce deployment with Mastercard, Northmill, and commerce enablement tech firm, NMI. The partnership will bring Mastercard’s Cloud Commerce solution to SME merchants across 3 Nordic markets – Sweden, Norway, and Finland.

Minna – In May 2019, Swedish subscription management platform Minna Technologies raised €5.6 million in a Series A funding round led by Zenith Group and joined VISA and Swedbank. Launched in 2016, Minna began life as a consumer app that lets people manage their subscription services – utilities, telecoms and streaming services. Minna has been busy striking deals with the likes of Swedbank and Danske to integrate the technology directly into banking apps. Users see all their subscriptions in one place, can cancel any unwanted ones with a click and find and switch to more suitable suppliers. In January 2021, Minna raised $18.8 million in a Series B funding round, adding to a May 2019 Series A round which raised €5.6 million from Zenith Group and VISA. As of October 2024, Minna reported to have reached over 120 million retail bank and fintech users and more than 22,000 subscription businesses.

Rocker – in May 2020, another Swedish bank challenger, Rocker (formerly known as Bynk), selected Finnish fintech firm Enfuce as its official card issuing and payment processing partner. The move is aimed primarily at the issuance of VISA prepaid cards. Having already launched a VISA debit card, Rocker began expanding its operations across Europe. Rocker aims to offer products related to saving, borrowing, and paying. It noted that it will be easier to offer these products as a licensed bank. In October 2021, Rocker announced plans to list on the Nasdaq First North Growth Capital stock exchange, having posted revenues of SEK 89 million in 2020.

In February 2022, Rocker launched a biometric payment card in partnership with ID specialist IDEMIA and fingerprint sensor specialist IDEX Biometrics. The card is certified by Visa and Mastercard. As of October 2024, Rocker has more than 1 million users with its cards used in more than 170 countries.

Klarna – in March 2020, Swedish bank challenger Klarna announced that China’s Ant Financial had acquired a less than 1% stake. Ant Financial is an affiliate company of e-commerce firm Alibaba, which operates the Chinese digital wallet Alipay. In June 2021, Klarna raised $639 million in a funding round, giving it a valuation of $45.6 billion. This followed another funding round in March 2021 which raised $1 billion, and a $650 million raise in September 2020. As of mid-2021, Klarna was the highest-valued private FinTech in Europe. However, tougher market conditions in 2022 saw losses tripling from 2020 and its valuation falling to $6.7 billion in July 2022. As of 2024, Klarna operates in 45 markets globally, with a significant presence in the US and Europe. It has over 150 million active users and collaborates with more than 575,000 merchant partners. This growth has been fuelled by partnerships with major brands such as Uber, Expedia, and Airbnb. Klarna’s gross merchandise volume (GMV) surpassed SEK 1 trillion ($90 billion), and the company has expanded its AI capabilities to drive efficiency, contributing to its strong financial performance in 2024​.

In August 2022, Klarna announced that it was launching a new feature on its app, enabling consumers to keep track of all their online purchases, including those not made via Klarna, with product images, prices, order and delivery status, and parcel tracking information. In August 2023, Klarna announced its readiness for a stock market listing when market conditions improve, having met all requirements for an IPO. In September 2023, Klarna introduced a suite of new features, including an AI-powered image-search tool, shoppable videos, in-store product scanning, and a new cashback program. As of October 2024, Klarna is yet to be listed publicly.

Tink – Established in 2012 as a consumer app, Tink’s Open Banking platform connects to more than 3,400 European banks and institutions through one API. In June 2021, Tink was acquired by VISA in a deal worth around €1.8 billion, making it the third-largest acquisition of a European venture capital-backed FinTech. More than 300 banks and FinTech start-ups use Tink’s API to access third-party bank information, covering 250 million bank customers across Europe. By 2024, Tink reported having more than 13,000 connections to all major banks across Europe and processed more than 10 billion transactions per year.

Digital Banking

All Swedish retail banks offer online banking services and mobile banking apps to their clients. Services available include balance and transaction reporting and payment initiation. Domestic and cross‑border sweeping facilities are also offered. 84% of all Swedish bank clients were e-banking users as at-end 2023.

The growth of internet banking means that electronic banking is growing, while the number of Swedish branches and bank employees is gradually declining, from 1,883 total branches in 2010 to 959 branches in 2023. The Swedish Bankers’ Association developed a Nordic XML‑based standard MIG (Message Implementation Guideline), based on C2B payment initiation, for e‑banking, in conjunction with its Danish, Finnish and Norwegian counterparts. Mobile banking apps with added mobile money transfer services include PayPal.

Sweden’s leading banks and the Swedish Post Office (Posten) all offer online bill presentment facilities.

In 2020, the Riksbank reported that it had been approved by the Bank for International Settlements (BIS), in cooperation with the central banks of Denmark, Iceland and Norway, to establish a BIS Innovation Hub Nordic Centre in Stockholm. The Riksbank will play an active role in developing research around digital solutions and the analysis of FinTech innovations.

Swedbank – In 2023, Swedbank recorded more than 3 billion digital customer interactions per year, with more than 99% of customer interactions being digital. Swedbank reported 3.5 million active digital customers in 2023.  Swedbank has historically been a leader in digitalisation, including ATMs, telephone banking, internet banking, and its app. As of 2023, Swedbank refers to itself as a digital bank with a physical presence, but still counts the branch network as an important part of customer service.

SEB – During 2023, SEB continued to develop the functionality in its digital channels, both the mobile app and the web. It enabled digital communication with private customers through secure messages in the mobile app while also improving functionality in the digital channels available for large corporates and private banking customers. SEB also made further improvements to its mobile app, enabling customers to buy and sell mutual funds, which was a first step in a planned roll-out that also will enable equity trading.

During 2023, SEB reported that as customers turned to more digital services, they increasingly expected proactive and personalised advisory services in digital formats. This was reflected in increasing digital activity, with mobile interactions representing more than 80% of customer interactions. SEB said it would continue to execute on its digital transformation agenda, focusing on connectivity, automation and analytics to improve operational efficiency and speed.

In 2023, 191 million Swish mobile payments were made via SEB’s app, compared to 102 million in 2022. According to SEB data, for customers aged between 18-24, 89% were using Swish mobile app in Sweden, compared to 79% in 2018. For those aged 65+; 50% were using Swish in 2021 compared to 26% in 2018.

In collaboration with the third-party vendor Verified, SEB rolled out a cloud-based e-signature solution for large and medium-sized companies in Sweden and Norway, enabling digital signing of agreements.

Nordea – At end-2020, Nordea Bank Sweden reported over 6 million active internet and mobile banking customers. Nordea said that Nordea Wallet will be continuously developed in order to help customers in their daily shopping. Accordingly, a new mobile app was launched in 2018 and has been rolled out across Sweden and Finland.

In 2023, Nordea had over 4.6 million digitally active customers, up from 4 million in 2022, and 13% more monthly logins to its digital services than in 2022. The Nordea mobile banking app now has more than 1 billion logins annually. The bank is moving towards enabling private customers to carry out daily banking tasks 100% digitally.

In 2021 Nordea continued to advise customers and provide support through digital channels, with 7% more customers using the mobile bank than a year ago, and increased inflows through digital channels. Nordea began transitioning to its new netbank platform during 2021, and added new functionalities in the netbank and mobile app. More than 275,000 customers in Denmark, Finland and Sweden are now able to use the Nordea Business, netbank for SMEs. In 2022, the bank was awarded the best mobile bank in Denmark, Finland, and Sweden.

In 2023, the bank reported a 13% increase in average number of monthly logins compared to 2022.

Handelsbanken – In 2020, Handelsbanken reported that digitalisation offered huge opportunities to reach more customers with value-creating advice and services adapted to customers’ specific needs. Customer-centric and increasingly personalised digital services have simplified the everyday tasks that customers carry out. However, the bank also reported that its customers did not want to go fully digital or fully branch based.

Handelsbanken invested an additional total of SEK 1 billion into digital development over 2021 and 2022, over and above current development investments. In 2023, Handelsbanken continued to prioritise digital transformation, maintaining a high investment in IT to support its digital growth and improve its customer service channels. The initiative is expected to result in further improvements to the customer experience and will allow the bank to better meet customers’ expectations with regard to advisory services and offerings via digital meeting places.

During 2020, Handelsbanken reported a major increase in contact by phone and digital channels such as Skype and email. It introduced customer events via Skype-developed automated services for both customers and branches. In Sweden, customers can digital meetings via Skype, Teams, Webex, Google Meet or other channels, including at local branches.

In 2020, Handelsbanken enabled corporate customers in Sweden to sign agreements digitally. Several services such as Swish Corporate can be signed digitally via business services in online banking. Apple Pay has been launched in Sweden, Norway and Denmark.

Using its MobilePay app service from Denmark, Danske joined the Swedish immediate payment service Swish (see below).

Account Aggregation Services – In January 2018, Danske Bank embraced the Open Banking era, revamping its mobile app to let Nordic customers view data from their accounts with other providers. From April 2018, Swedish customers were able to gather payment and bank details of all the banks that they use and see it within the app. Denmark, Norway and Finland followed later in the year.

In August 2020, Danske Bank launched a new mobile solution that enables Danske Bank’s customers to transfer money through Danske Mobile Banking from payment accounts that customers have with other banks. The new solution is carried out via the Nordic API Gateway platform, which has combined access to all Nordic banks’ data in one place.

In April 2018, Swedbank invested €3 million in a personal finance management and data aggregation platform, Meniga, as it begins the rollout of the firm’s technology to customers in Sweden and the Baltic countries. Meniga, founded in Iceland in 2009, announced the acquisition of Stockholm-based rewards platform, Wrapp, in 2019. Meniga stated the acquisition would help to expand its network and customer base. In December 2020, Swedbank worked with Meniga to launch next-generation digital banking services based on customer behaviour, available in Swedbank’s mobile app and internet bank.

In May 2020, Nordea announced the addition of Tink’s account aggregation and personal financial management technology into its mobile app in Sweden, Norway, Finland and Denmark. The new features will let app users get an overview of their finances in one place, including card transactions, mortgages, savings, loans and current accounts, including from other banks.

About Open API Standards

In June 2017, The Berlin Group, the European payments interoperability coalition of banks and payment processors with membership comprising bank-backed ACHs and industry bodies, announced it would push a single standard for API access to bank accounts (XS2A) compliant with the PSD2 regulation.

The Berlin Group says its NextGenPSD2 Initiative provides a harmonised API standard for accessing bank accounts. Built as an ‘Access to Account Framework’, The Berlin Group says the standard offers operational rules and implementation guidelines with detailed data definitions, message modelling and information flows based on RESTful API methodology.

As of the beginning of 2021, the Berlin Group NextGenPSD2 was implemented in all EU countries, in several non-EU countries in Europe and in countries outside Europe who are focused on maintaining reachability and compatibility with the European market. Around 80% of European banks and hundreds of third-party providers (TPPs) have implemented the Berlin Group NextGenPSD2 Framework. In 2021, the group was migrated to the Open Finance task force to explore use cases of Open Banking schemes and Open Finance schemes.

Among others, European Open API sets include Open Banking UK, Swiss Corporate API, and STET Open API (F, B).

The Nordic banks started a process of developing a so-called Nordic API set for the Nordic region in 2018 with the launch of Open Banking platform Nordic API Gateway. With connections to nearly 3,000 European banks and a reach of over 337 million European consumers, Nordic API Gateway partnered with Santander Consumer Bank in March 2021 to deliver open banking capabilities for Santander’s new consumer-focused money app Prosper. The app is expected to offer Nordic users a complete financial overview across banks by leveraging account aggregation and payment initiation services. Lunar Way also selected Nordic API Gateway (now: Aiia) to enable account aggregation in August 2020 across Denmark, Sweden and Norway.

PSD2 and the Open Banking Mandate

The adoption of the revised Payment Services Directive, PSD2, has set the stage for Open Banking in Europe, a European Open Banking Mandate with significant impact on the financial services industry. PSD2 challenges for banks and FinTechs include Open Banking, Open APIs, and the rollout of digital payment services and mobile apps.

PSD2 lowers the barriers for market entry to third-party service providers, FinTechs, and it opens up doors for innovative players to offer services that currently do not exist, e. g. account information services, third-party personal finance management, digital identity and KYC.

PSD2 is going to change the European payment and banking landscape and ultimately the position and role of banks in the ecosystem. FinTechs drive the change with the banking industry seeking the right strategy.

Post-PSD2, the key question for the financial service industry will be how to grant authorised access for their FinTech partners to bank account information, for instance secure access to account balance, payment data, credit risk and others.

For banks, the impact of the PSD2 is that they are no longer the only ones that have access to the bank customer information. Bank customers will now decide who they want to grant access to their payment information. Alongside this initiative, with new services based on access to bank accounts (XS2A), banks may lose the direct connection to their customers. To maintain their position in the new PSD2 reality, banks will need to adapt their business and operational models.

By mid-2024, notable challenges for the Swedish banking industry include:

In May 2018, the Swedish FinTech startup, Open Payments Europe, provided a PSD2-compliant infrastructure platform that offer users a single, open and secure point of access to the diverse bank APIs throughout the EU.

In June 2019, PayPal made a strategic investment in Swedish Open Banking platform Tink as part of a wider partnership between the two firms.

In January 2020, Tink raised €90 million in new funding, just 11 months after a €56 million round of funding. The injection of capital accelerated Tink’s European expansion plans to become the preferred pan-European provider of digital banking services and increase its local presence across the region.

In November 2020, Tink completed the acquisition of Spanish account aggregation provider Eurobits.

As of December 2020, Tink had raised $103 million in a funding round, giving it a valuation of €680 million. In total, as of 2020, Tink had raised over €175 million. Tink counts 3,400 banks, covering over 250 million customers, with partners including Nordea, SEB, PayPal and BNP Paribas. There are also around 8,000 developers using its APIs.

In June 2021, VISA announced it was acquiring Tink for $2.1 billion, after VISA’s planned takeover of US Open Banking start-up Plaid was blocked.

The large Swedish banks have their own Open Banking API sets at a group level. Aggregators such as Aiia, Swedish FinTech Open Payments and Mastercard Payments Services offer their Open Banking API set to connect Nordic banks with each other and with independent PISPs and AISPs.

Swedish banks provide Open Banking API access in combination with aggregators, which provide connectivity between Nordic banks and between banks and independent PISP/AISPs. This approach may be a basic step towards a potential future Nordic Open Banking API set as part of a Nordic cross-border payment infrastructure.

In 2020 SEB joined the Nordic Smart Government collaborative initiative, launched by the Nordic Ministers of Business. The initiative aims to simplify daily life for small and medium-sized companies by creating digital connections with governmental units via API structures. Within the area of Open Banking, SEB stated a number of new APIs and services were developed to support the transformation towards a modern technology architecture and speed up development and customer value delivery.

As of mid-2024, there were 44 Open Banking APIs in use in Sweden, 21 API aggregators, and 36 third-party providers passported in the country.

Payment Services

In Sweden, the law on payment services adopted the EU payment services directive (PSD) and the EU interchange fee regulation (IFR). Sweden adopted the new PSD2 in September 2019.

In 2024, the more than 300 different payment services offered in Europe can be grouped into:

Card Brands and Card Types

At present, there is no national card schemes in Sweden, and all retail banks issue debit cards and credit cards with one of the Mastercard or VISA brands.

Specific to the Swedish card business is the issuance of combined debit/credit cards with two card functions on one card. Thus, the number of payment functions on cards is higher than the total number of cards.

Swedish card products like consumer cards, commercial cards and purchasing cards range from classic cards to gold cards and platinum cards. Additional card features (e.g. picture cards, bonus points, PIN selection at ATMs, cashback, card control by SMS notification and geo blocking) are used to attract cardholders. Also, individual picture cards and collector cards are issued on demand.

The EMV migration of cards was completed in 2012.

From July 2023, banks and other card issuers will no longer issue Maestro cards. Instead, they will need to issue Debit Mastercard cards. Maestro was launched in 1991, and it was the world’s first debit card that could be used via an online network. About 400 million Maestro cards are in circulation worldwide, mainly across Europe. However, Maestro is not enabled for the demands of e-commerce and cannot be used for online or in-app payments, hence the decision to phase it out in favour of Mastercard Debit products. VISA phased out Electron cards in April 2024. The features of the Visa Debit card have been modified to match the features of the Visa Electron card.

Debit cards issued are Debit Mastercard and VISA Debit cards. There are no V PAY cards in issue.

Credit Cards issued are cards branded VISA, Mastercard, American Express, or Diners. There are no JCB cards in issue.

Prepaid Cards – Reloadable bank prepaid cards issued are prepaid Mastercard, prepaid Maestro, prepaid VISA Debit and prepaid VISA Electron cards. The Swedish National Debt Office issues a prepaid Mastercard card that may be used for retail payments.

Co-branded cards – In Sweden, several co-branded card products are in circulation. Co-branded cards are based on the international card brands Mastercard, VISA, American Express, or Diners.

Swedish banks issuing co-branded cards together with their non-bank partners include Nordea Bank, Svenska Handelsbanken, Swedbank, SEB Kort, ICA Bank, EnterCard, and others.

Co-brand partners include retailers, car manufacturers, airlines, and football clubs.

Contactless Cards and form-factors

From 2016, the Swedish banks issue contactless cards. In June 2015, ICA Banken launched first contactless card in Sweden followed by Nordea Bank.

Predefined contactless limits – Contactless payments for purchases below a predefined limit are without PIN or signature and without transaction receipt. In Sweden, the contactless limit for payments without PIN/signature is set to be SEK 200 for cards with the PayPass or payWave function, including international and domestic cards. In March 2020, the limit was raised to SEK 400 in response to the COVID-19 pandemic to encourage more non-cash transactions.

Virtually all new payment cards are equipped with contactless technology, and the Riksbank’s goal was for all cards and 100% of POS terminals to be equipped with NFC by the end of 2020.

In 2023, the use of cash in Sweden continued to be abysmal in favour of cards and digital payments, continuing a trend of low cash usage. In the 2023 Riksbank survey, 44% said they had paid with cash in the past month. This is an increase from spring 2022. Back then, the corresponding figure was 34%. 10% responded that they paid in cash for their most recent purchase in-store compared to 8% in 2022. This increase, though small, has been partly attributed to heightened crisis awareness following geopolitical events like the war in Ukraine. Many Swedes now view cash as a valuable backup option in case of disruptions to digital payments, such as during crises or technical issues. Despite the minimal increase in cash usage, Swish and other mobile payments continue to dominate, especially for daily transactions. In the 2023 survey, more than 80% said they had used Swish in the last month, compared to 52% in 2016. Swish is mostly used for payments between private individuals or for online purchases. According to the survey, almost all payments are made digitally, Swedish people shop online more often and use cash less often. In the payments market, cash is being replaced by digital payments, usually by card or Swish. Although the use of Swish has increased in recent years, cards are still the most common payment method. Nine out of 10 people have paid by card in the last month. Sweden is one of the most digital countries in the world. Nine out of 10 Swedes use the internet daily and 3 out of 4 identify themselves digitally using mobile e-ID.

Biometric Cards – In August 2017, Sweden-based identity and security provider Nexus and Zwipe (N), a biometric technology company, teamed up to roll out biometric access cards.

The sale of Zwipe’s biometric access cards was launched using the online portal Nexus GO Cards. The biometric access card enables the user to complete the identity verification process by placing their finger on the fingerprint sensor on the access card before presenting it to the card reader. Only the rightful owner of the card can use it, hence a lost or stolen card, or employees exchanging cards is no longer a security threat. The user’s fingerprint is registered directly and only on the chip of the card, which means there is no need for biometric databases.

Fingerprints AB, a Swedish company providing biometric factor technologies founded in 1997, is one of the world’s leading providers of two-factor authentication solutions for the payments industry.

In December 2020, Fingerprints and Swedish FinTech Rocker teamed up to launch contactless biometric payment cards in a pilot project. The card has been developed in collaboration with IDEMIA and is expected to deliver increased image quality and transaction speed as well as improved power efficiency by combining extensive R&D investment with key learnings from more than 20 market pilots and commercial rollouts. It will also add improved security features, including encryption as well as additional privacy layers to the storage and communication of biometric data.

Fingerprints has also partnered with STMicroelectronics to develop an advanced Biometric System-on-Card (BSoc) solution, based on fingerprint recognition technology.

Interchange Fee Arrangements

International and Intra European Non-EEA Interchange Fees are set by the members of the international card schemes to be applied in case of cross-border transactions or foreign cards used in Sweden, respectively. The effective rates of Mastercard and VISA can be found on the respective Mastercard and VISA websites.

In Sweden, domestic Merchant Interchange Fee (DMIF) rates for Swedish cards is defined by Mastercard and VISA, respectively. The interchange fee regulation 2015/751/EU applies for Swedish card business.

The interchange fees for domestic card-based payment transactions on consumer cards are capped as follows:

American Express – As a result of the EU regulation of interchange fees (IFR), American Express elected to exit all its bank licensing arrangements in the European Union. This means that they have terminated all licenses with its existing EU partners, stopped issuing new cards and are in the final stages of the process of closing down all operations directly related to bank licensing. Over the course of 2019, American Express credit cards issued under independent operator agreements were rendered invalid in all countries of the European Union. Various banks that have up to now had exclusive licensing contracts with American Express have already responded accordingly and provided their clients with the opportunity to switch to other card brands.

From 2020, American Express Payments Europe is now the sole issuer and acquirer of American Express cards in Europe, including Sweden. However, American Express Payments Europe continues its local sales partner arrangements with local acquirers enabling the use of American Express cards at ATMs and POS terminals.

E-Money 

Launched in 1998 and based on Proton technology, the Swedish electronic purse CASH never achieved critical mass and was phased out in 2004.

In Sweden, the law on e-money services has adopted the e-money directive of the EU (EMD).

In 2022, there were 6 e-money institutions (EMI) resident in Sweden (Intergiro, Mynt, Smart Refill, Steven, Talkremit, and Juni Technology).

Also, numerous foreign e-money institutions offer payment services in the country on a cross-border basis. Additionally, software-based e-money e-/m-wallet services are also offered by international payment service providers and e-wallet issuers from the EEA region. They provided notification of operating in Sweden under the EU passport system.

Prepaid Products – paysafecard (A) entered Sweden and launched its prepaid product, paysafecard.

Digital Account-to-Account Payment Services 

In the Yearbooks, account-based payment services are classified as IBAN-based payment services in SCT/SDD format offered by banks or by independent payment initiation service providers (PISP).

Credit transfers are used for both high value corporate and low value retail payment transactions. They can be paper-based or automated. Electronic credit transfers are used by the government and companies for salary, supplier and benefit payments.

Sweden is a part of the SEPA initiative for euro-denominated retail payments. Most Swedish banks participate in the SEPA Credit Transfer (SCT) Scheme.

Direct debits (autogiros) are used for low value recurring payments such as utility bills. A paperless direct debit, Nya Autogiro (New Direct Debit), was launched by Bankgirot in November 2011. Bankgirot has outsourced the processing of Nya Autogiro to VocaLink, the British CSM processor recently purchased by Mastercard.

SEPA Direct Debit (SDD) Schemes were launched on 2 November 2009. Banks in Sweden are required to accept SDD Core transactions from 1 November 2014.

Immediate payment service Swish – In December 2012, leading Swedish banks launched the immediate payments service app Swish operated by Getswish AB (see below).

Instant payments (SCTINST) is the IBAN-based immediate payment scheme in Europe, officially launched in November 2017. It makes funds immediately available to the beneficiary – compliant with existing SCT infrastructure. The regulators will require all banks to offer Instant Payments from 2018.

Among others, the characteristics of SCTINST include an initial maximum of €15,000 with the funds made available on the beneficiary’s account in less than ten seconds, 24/7/365 real-time processing, and immediate refunds in the case that the SCTINST payment was not successful. From July 2020, the maximum amount for instant payments will be €100,000.

Chaired by the ECB, in 2014, the Euro Retail Payments Board (ERPB) identified the need for a pan-European instant euro payment solution. In April 2016, EBA Clearing started the SCTINST project with more than 40 large European banks involved. In November 2016, the European Payments Council (EPC) published the SCTINST scheme and SCTINST rule books version 1.0 while the ERPB provided the governance model. In November 2017, EBA Clearing completed the pan-European instant payments infrastructure, RT1.

SEPA credit transfers and direct debits can be settled on a same-day or next-day basis. In 2021, about 50% of all IBAN-based payments in Europe were processed intra-day, or even immediately inside of the same bank group. Potential first use cases for SCTINST in Sweden may include P2P, mobile banking apps, online payments, and B2B.

As of May 2024, 2,295 banks from 36 European countries had registered for the SCTINST scheme. This represents 63% of all SCT scheme participants.

The Riksbank provides the payment system RIX, which handles large-value payments in Swedish kronor between banks and other actors. The Riksbank already has an agreement with the ECB to enable instant payments in SEK to be made using the ECB’s platform, TIPS. The new service, called RIX-INST, was launched in May 2022. At present, instant payments are only available via the Swish mobile app. The purpose of RIX-INST is to offer a system for the settlement of instant payments in central bank money that Swish and other new services can use. RIX-INST will allow banks or payment service providers to offer more services in which payment is made immediately. In Sweden, from November 2024, the Riksbank will require that banks participating in the Riksbank’s RIX payment system that already offer instant payments via Swish can also accept instant payments made by other means. This makes it possible to develop more instant payment services.

As in many European countries, bank transfers have been adopted for online payments, enabling consumers to pay direct from their bank account as an alternative service to payment cards.

Mono-line credit transfer payment services on the internet are offered by the banks Nordea (Nordea Solo), Handelsbanken, SEB, Swedbank, and other Swedish banks.

Payment initiation service providers (PISPs) offering online credit transfers in the country include Trustly (S), Inpay (DK), Klarna’s SOFORT (D).

Following the adoption of PSD2 in September 2019, as of 2022, there were 130 AISPs and PISP providers licenced in Sweden by Finansinspektionen.

Minna Technologies received authorisation in 2019 from Finansinspektionen to operate as both an Account Information Service Provider (AISP) and a Payment Initiation Service Provider (PISP). These authorisations will allow Minna to further develop and update existing services, while providing other additional services.

In 2020, Trustly became a licensed PISP and operates under the supervision of Finansinspektionen. Authorised in another EEA member state, cross-border PISPs have provided notification of operating in Sweden under the EU passport system.

Klarna – In December 2013, Swedish online payments firm Klarna acquired German rival SOFORT for around $150 million. The combined firms will continue to offer Klarna Invoice, SOFORT online bank transfer services and instalment payments in the 14 European markets in which they operate. Klarna claimed to share 10% of the $100 billion e-commerce market in the 14 countries, with 25 million users and 43,000 merchants. As of 2023, Klarna claimed to serve more than 150 million global customers. In October 2014, Klarna and Digital River, a global provider of Commerce-as-a-Service solutions, formed a partnership agreement. Digital River will add Klarna Invoice to its portfolio of online payment options in Europe. Klarna is using the Digital River solution to process consumer credit cards and online bank transfer payments through Digital River’s international payment gateway.

In February 2017, Klarna acquired Germany’s BillPay, a Berlin-based consumer financing outfit owned by UK payday lender Wonga, for about £60 million. BillPay is licensed by BaFin and offers its products and services in Germany, Austria, Switzerland and the Netherlands. Established in 2009, BillPay claimed 5,000 online merchants and 12 million consumer users.

In June 2017, Klarna was granted a full banking licence by Finansinspektionen, the Swedish Financial Supervisory Authority. VISA bought a stake in Klarna as part of a planned strategic partnership with the Swedish payments firm focussed on pushing online and mobile commerce in Europe. Private equity investor Permira bought a 10% stake in Klarna at a cost of £250 million.

In September 2018, Klarna bought the retail financing arm of merchant bank Close Brothers to strengthen its position in the UK market. The acquisition of the Close Brothers business gave Klarna access to a further 600 active merchants in the UK – including brands such as Samsung Electronics, Mothercare, GAME, Jessops, Ebuyer, Emma Mattress, Cotswold Outdoor and Victorian Plumbing – and a loan book of around £66 million.

In March 2019, Klarna launched its own Open Banking Platform. This platform will enable access to more than 4,300 European banks through a single Access to Account (XS2A) API. Klarna claimed its XS2A API is the most established and proven solution that has been developed at scale across markets for almost 15 years through the Klarna Group company Sofort (D).

In April 2019, Klarna announced the launch of its global authentication platform. The platform complies with PSD2 and KYC regulation and allows multinational businesses, including merchants and other banks, to provide a personalised customer authentication experience irrespective of market, through a one-time integration. Once the authentication platform has been embedded on the site it will always be kept up-to-date as new authentication methods are automatically added without any extra work from the site owners’ developers.

In August 2019, the company secured an equity investment of $460 million to support US expansion in a deal which valued the company at $5.5 billion. By September 2019, the company reported 3 million customers in the UK following heavy advertising campaigns under the “No drama, just Klarna” campaign, which led to 12 million transactions in the first nine months of 2019.

In March 2020, Klarna announced that China’s Ant Financial had acquired a less than 1% stake. Ant Financial is an affiliate company of e-commerce firm Alibaba, which operates the Chinese digital wallet Alipay. Klarna was at the time valued at around $5 billion. In September 2020, Klarna raised $650 million in an equity funding round.

In June 2021, Klarna raised $639 million in another funding round, giving it a valuation of $45.6 billion. This followed another funding round in March 2021 which raised $1 billion. In June 2021, Klarna raised $639 million in a funding round, giving it a valuation of $45.6 billion. This followed another funding round in March 2021 which raised $1 billion, and a $650 million raise in September 2020. As of mid-2021, Klarna was the highest-valued private FinTech in Europe. However, tougher market conditions in 2022 saw losses tripling from 2020 and its valuation falling to $6.7 billion in July 2022. As of mid-2023, Klarna was live in over 45 markets with more than 150 million active users globally.

In August 2022, Klarna announced that it was launching a new feature on its app, enabling consumers to keep track of all their online purchases, including those not made via Klarna, with product images, prices, order and delivery status, and parcel tracking information. As of 2023, Klarna’s app includes an advanced feature that consolidates users’ entire online purchase history, even from non-Klarna purchases, providing real-time updates on delivery status, product details (such as images and prices), and parcel tracking information. This feature is available for users connecting their email accounts, enabling Klarna to automatically gather data from order confirmation emails from popular email providers like Gmail and Outlook. This functionality, launched in the UK in 2022, supports Klarna’s initiative to streamline the online shopping experience and accommodate various delivery preferences that have become more popular among younger consumers.

Trustly, founded in 2008, has its headquarters in Stockholm and offices in Spain, Malta, Germany and the UK. Trustly offers cross-border payments to and from consumer bank accounts at 6,300 banks worldwide and connects businesses and consumers within e-commerce, travel, gaming, and financial services. It claims a global reach of 525 million consumers, and by 2023, it has processed $58 billion in transaction volume in its global network.

In March 2017, Trustly launched Trustly Direct Debit, a new payment product for recurring purchases including subscriptions services and one-click payments. Trustly Direct Debit is redefining the way recurring payments are made for subscription services, such as digital music and magazine subscriptions, monthly donations and credit repayments. The new product is based on Trustly’s direct online banking e-payments service and works on both mobile and desktop devices.

In March 2017, UATP announced that it is partnering with Trustly, enabling airlines to easily accept instant online bank payments for ticket purchases across Europe. In August 2017, Trustly partnered with Qliro, a Nordic PSP. Trustly will become a permanent online banking option for Qliro’s checkout service, Qliro One. With Trustly integrated as a payment option in Qliro One, retailers can now let their customers pay directly from their bank account.

In March 2018, private equity investor Nordic Capital acquired a majority stake in Trustly, with management, founders and investment company Alfvén & Didrikson remaining the other shareholders. Financial terms were not disclosed, although the agreement is rumoured to value Trustly at around €700 million.

In May 2019, Trustly partnered with Swedish start-up challenger bank, Collector, to offer mobile POS payments for Collector customers. In June 2019, Trustly merged with US-based PayWithMyBank to create a transatlantic payment network for consumers to pay for online shopping direct from their bank accounts.

In September 2019, Trustly signed a deal with Ingenico to provide e-commerce payment solutions for Alibaba’s customers based in 16 European countries, including Austria, Belgium, Estonia, Finland, Germany, Ireland, Italy, Latvia, Lithuania, Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, and the UK.

In June 2020, Trustly announced that a consortium of institutional investors, including BlackRock, Aberdeen Standard Investments, funds managed by Neuberger Berman, Investment Corporation of Dubai and RSIC, would become minority shareholders.

In May 2022, Trustly announced the acquisition of UK-based Open Banking payments platform Ecospend. In 2021, Ecospend processed over £5 billion in A2A payments for over 2 million consumers.

However, Trustly reported a challenging 2022 including a significant fall in revenue and a fine from the Swedish regulator. In 2022, turnover fell 36% to €124 million due to the decision to leave certain markets temporarily. The vast majority of revenue is from Northern and Western Europe. At the end of 2022, Trustly had business in Finland, Czech, Denmark, Germany, Malta, Netherlands, Norway, Poland and Spain. It exited the UK, Austria and Belgium although has since returned to the UK with the acquisition of Ecospend.

Ecospend, a licensed payment institution, brought a key customer relationship with the British Government and connections with 80 UK banks. Ecospend’s payment volume was reportedly £7.5 billion in 2022.

In February 2022, the Swedish Financial Services Authority fined Trustly 130 million SEK (€12 million) related to compliance with anti-money laundering regulations. As a result, Trustly ditched plans for a $9 billion IPO, reorganised its operations and implemented new business controls.

The second key acquisition was SlimPay, the French recurring payment and A2A specialist. This deal, for a reported price of €70 million, closed in January 2024. Slimpay reported post-tax losses of €1.8 million on €11.3 million sales in 2022. The deal brings Trustly 2,000 good quality merchant customers in transportation, media, fitness and financial services including SNCF and EDF.

In May 2016, Stripe (US) launch its service ‘Managed Accounts for Stripe Connect’ to marketplaces based in the UK, Ireland, Sweden, Denmark, Finland, and Norway.

Advanced Payment Services

In the Yearbooks, advanced payment services are classified as online wallets, e-wallets, and/or mobile wallets with any type of payment service chosen by the wallet user to complete the payment.

In selected Swedish online shops, the wallets PayPal, Skrill and Payson are offered as payment means.

PayPal – PayPal is available in Sweden. As of end-2023, PayPal reported more than 431 million active customer accounts globally, down 0.91% from 435 million in 2022.  During 2022, PayPal added approximately 8.6 million net new active accounts, ending the year with 435 million active consumer and merchant accounts. PayPal’s total payment volume increased to $1.52 trillion (up 11.6% from 2022) and customer engagement grew to an average of 58 transactions per active account, driving 13% growth in transactions per active account at the end of 2023.

During 2020, with consumers worldwide embracing digital wallet capabilities, the company launched several related services including QR Code Checkout, Buy Now Pay Later, Crypto purchasing and Xoom direct transfers to bank accounts and debit cards.

In June 2018, PayPal continued its shopping spree with a $400 million cash deal to acquire e-commerce platform Hyperwallet. The acquisition followed deals to buy Venmo, Xoom, Sweden’s iZettle (renamed Zettle) for $2.2 billion and AI-based merchant marketing outfit Jetlore, as Paypal bids to extend its reach to all corners of the payments market.

In May 2022, PayPal Ventures invested in Modulr, an embedded payments platform for digital businesses, as part of a $108 million Series C funding round led by General Atlantic, Blenheim Chalcot, Frog Capital, and Highland Europe. Modulr delivers payments infrastructure for over 200 top-tier customers, including Revolut, Wagestream, Sage and BrightPay, and processes an annualised transaction value of more than £100 billion.

In 2023, PayPal is still exploring the sale of Xoom, its international money transfer subsidiary, in a bid to cut costs and focus on high-growth business areas. Also, Stax Payments – an all-in-one payment provider for businesses – announced its partnership with PayPal in July 2023. This partnership will allow PayPal’s users to easily make payments with more than 20,000 merchants of Stax through a fast checkout process as well as new payment options such as Buy-now-pay-later solutions.

In 2023, PayPal launched its own US Dollar denominated stablecoin, PayPal USD (PYUSD), which is fully backed by US dollar deposits, short-term US treasuries, and similar cash equivalents and designed for digital payments and Web3. Eligible US PayPal customers who purchase PayPal USD will be able to transfer the token to external wallets, send person-to-person payments, fund purchases at checkouts supported by PayPal, and convert cryptocurrency holdings to and from PayPal USD.

In January 2024, PayPal launched AI-powered features to drive personalised offerings for both merchants and customers based on the data it possesses. These features include Smart Receipts (for merchants) which predicts what shoppers may want to buy next from the merchant. The merchant can then offer personalised recommendations, and cashback offers on this receipt. A major feature for users is CashPass which will use give users personalized cashback offers based on an AI analysis of their spending activity.

In March 2024, PayPal launched a complete suite of payment processing tools for online small businesses in the UK, Canada, and across more than 20 European markets. The PayPal Complete Payments package enables small businesses to accept an expanded range of payment instruments including PayPal, buy now pay later, Apple Pay, Google Pay, credit and debit cards, and alternative payment methods from around the world. By April 2024, PayPal added new features to its complete payments solution for small businesses to enable small businesses to accept a range of payments including PayPal, Venmo and PayPal Pay Later products. PayPal also gave small businesses access to four new features to help them drive payment acceptance and enhance how they run their business, and this will include Apple Pay as a checkout option.

Amazon Pay – In 2016, Amazon (US) launched its checkout payment service, Amazon Pay, enabling customers to pay for goods and services in participating third-party merchant websites. All active Amazon account holders can use Amazon login and password at the checkout. More than 50 million customers have used Amazon Pay to make purchases globally, with more than half of these coming from Amazon Prime Members.

Digital Payment Services

In the Yearbooks, digital payment services are classified as card-based payment services using EMV tokenisation security on the internet combined with HCE NFC technology in the case of contactless payments at POS terminals.

In December 2013, SEB, Nordea, Swedbank, ICA Banken and Resurs Bank launched the digital wallet MasterPass for consumer online shopping using the MasterPass platform from Mastercard in the Nordic region. In Sweden, the wallet has also been integrated with the national Mobile BankID standard for secure log-in.

As of mid-2024 the Click to Pay online payment checkout service was available in Sweden. Click to Pay replaces the previous MasterPass and VISA Checkout services respectively. Click to Pay is a joint service between Mastercard, Visa, Discover, and American Express, enabling consumers to make secure one-click payments without having to enter card details or passwords online.

Contactless payments on cards using Apple Pay, Samsung Pay, or Google Pay (previously Android Pay) made by foreign users at contactless POS terminals in Sweden are processed as payments on contactless cards.

Global contactless transaction values will reach $15.7 trillion by 2029 with value of contactless payment transactions growing by 113% over the next five years up from $7.4 trillion in 2024.

Contactless ticketing spend will increase by more than 460% globally between 2024 and 2029 reaching $154 billion in 2029, with growing prominence and support for OEM pay solutions, such as Apple Pay, Google Pay and Samsung Pay being a key enabler for mobile NFC ticketing across many markets.

Overall growth in contactless transaction values will be catalysed by growing mobile payments adoption, with 99% of all smartphones capable of making contactless payments by 2027, up from 94% today, and average transaction values for Apple Pay reaching $28.20 and $33.40 for Google Pay.

According to the Riksbank, the number of payments using Swish in commerce almost doubled since the second quarter of 2020, from just over 12 million to almost 23 million in August 2021. From 2021 to 2023, Swish payments rose by 28% to 1 billion. By September 2023, 8.6 million users had used Swish to make 85.1 million payments worth SEK 41.6 billion.

Apple Pay has become one of the world’s most used digital payment methods. Its user base increased from 521.4 million to 535.8 million in 2022. By 2024, the total number of Apple Pay users was estimated at 640 million and is projected to exceed 700 million by 2027,

According to Apple’s Q2 last 2022, they saw a record of transactions with more than 1.8 billion processed during the quarter, up 40% year-over-year. This payment method is also available in over 90% of the US and 60% of stores globally.

Apple Pay is the #1 most popular digital wallet with a 92% market share, processing a global total of $6 trillion in payments in 2022 and produced a revenue of $1.9 billion.

Around 51% of global iPhone users have enabled Apple Pay in 2022. There are 10 million Apple Pay-friendly contactless payment terminals worldwide.

The transactions made using Apple Pay are mostly in-store purchases, online transactions, and peer-to-peer payments. It is trendy for contactless payments, especially during the COVID-19 pandemic.

In 2024, an estimated 60.2 million Apple Pay users in the United States; projections indicate that over 75 million consumers will use Apple Pay by 2030. Putting it all together, Apple Pay is increasingly becoming an effective customer acquisition and retention feature for Apple. In June 2022, Apple Pay added Apple Pay Later, its buy-now-pay-later service, allowing users to split purchases into four equal instalments with no interest or fees. Initially launched in the US, the service is expected to roll out to other countries during 2023. In 2023, Apple launched its Card savings account from Goldman Sachs with a 4.15% annual percentage yield. Apple Wallet users can set up and manage a savings account directly from Apple Card in Wallet, with no fees, no minimum deposits, and no minimum balance requirements

In October 2017, Apple launched Apple Pay in Sweden. As of November 2024, Apple Pay was supported by 119 banks and payment providers in Sweden.

Google Pay has 150 million users across 42 global markets.

In January 2022, it was reported that the company was planning to transform Google Pay into a “comprehensive digital wallet”, following the app’s reported slow growth and the shutdown of Plex. In April, it was reported that Google was planning to revive the “Google Wallet” branding in a new app or interface and integrated it with Google Pay. Google officially announced Google Wallet on May 11, 2022, at the 2022 Google I/O keynote. The app began rolling out on Android smartphones on July 18, replacing the 2018 app and co-existing with the 2020 Google Pay app in the US. While the app name itself was changed from Google Pay to Google Wallet, the service name of actually paying for things online or in-store remains as “Google Pay.”

In the US, Google Pay has over 25.2 million users.  Also, Google Pay is used on nearly 800,000 websites as a secure payment gateway. Roughly 20% of all mobile purchases are made using this digital payment processor.

Google Pay is available in Sweden through 60 banks and payment providers as of November-2024.

Samsung Pay is available in 31 countries worldwide and has an estimated 160 million users. Samsung Pay works with Galaxy phones, including the latest Galaxy S22. Samsung claims that its system will work with almost all point-of-sale systems: NFC, magnetic stripe and EMV (Europay, Mastercard and VISA) terminals for chip-based cards. In June 2022, Samsung Pay announced the launch of Samsung Wallet, enabling users to organise payment, loyalty, and gift cards into one app.

In May 2020, Samsung Pay unveiled Samsung Money by SoFi, a mobile-first money management experience that makes available a cash management account and accompanying Mastercard debit card via the Samsung Pay app, in partnership with fintech company SoFi.

In June 2022, Samsung Pay was renamed to Samsung Wallet in the US, UK, France, Germany, Italy, and Spain. Along with the renaming came new features such as the ability to store digital assets, and digital keys within the Wallet app.

Samsung Pay is available in Sweden through 20 banks and payment providers.

In 2017, EnterCard, Nordea, SEB, Swedbank and Handelsbanken launched Samsung Pay in Sweden. Bank customers in Sweden can use Samsung Pay to make in-store payments with their mobile phones. The service is available to all EnterCard cardholders and to Swedish bank customers that have an active private credit card or debit card and a compatible Samsung phone.

The customers use their mobile banking app to automatically register their debit or credit card (VISA and Mastercard) for Samsung Pay app use. After that, they can use Samsung Pay to pay with their phone in most stores around Sweden.

Overview of Cashless Payments

Sweden is said to be on track to becoming the world’s first cashless society, and as part of this the Swedish government is considering strategic moves to maintain access to cash. In 2023, the Riksbank stated that in 13 years, the proportion paying with cash has fallen from around 40% to less than 10%. At the same time, cash is used increasingly rarely.

According to the Riksbank’s survey in 2023, the proportion of people paying with cash has continued to decline, with only 6% of the population using cash for their most recent purchase, down from 8% in 2022. The trend of reducing cash usage persists, with more than half of the Swedish population continuing to reduce their use of cash due to the convenience and efficiency of digital alternatives. In the 2023 survey, more than 80% said they had used Swish in the last month, compared to 52% in 2016. Swish is mostly used for payments between private individuals or for online purchases. During 2020, cash withdrawals declined by 20% in Sweden, a trend which continued during H1 2021, but at a slower pace.

The dominant cashless payment instrument by number is card payments which accounted for 59.32% of all cashless payments compared with 62.34% across the EU.

Credit transfers and direct debits accounted for 32.93% and 7.75% respectively in 2023. However, credit transfer is the dominant cashless payment instrument by value.

Cheques have been almost phased out. Cheque use in Sweden is limited due to high bank fees (each cheque incurs a fee of SEK 15) and the fact that cheque guarantees apply only to amounts below SEK 2000.

In 2023, there were 638.4 cashless payments per capita composed of 378.7 card payments, 210.2 credit transfers, and 49.5 direct debits.

3 – Cashless Payment Transactions in Sweden

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Source: ECB, Sveriges Riksbank.

Exchange Rates

According to the 1995 accession treaty, Sweden is required to join the euro zone and therefore must convert to the euro at some point. Notwithstanding this, on 14 September 2003, a consultative Swedish referendum was held on the euro, in which 56% of voters were opposed to the adoption of the currency, out of an overall turnout of 82.6%. In 2015, support for Swedish membership of the euro among the general population was low.

The Swedish Kroner (SEK) is the domestic currency in Sweden.

4 – Average Exchange Rates

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Source: ECB.

Market Infrastructure

The Nordic countries constitute the most advanced and digitally ready payment market in Europe, and among the most advanced in the world.

In September 2018, Italian payment processor SIA provided Denmark’s central bank with a new real-time gross settlement system (RTGS) that connects banks, mortgage banks and settlement systems. The new RTGS has replaced the previous in-house system that has been in use by the Riksbank, and it secures real-time transfer of Swedish kroner.

The Riksbank operates the payment system RIX, which handles large-value payments in SEK between banks and payment system participants. In 2020, three new participants joined RIX. As of May 2024, the RIX system had a total of 45 participants. The number of transactions processed increased with the introduction of the new payment system from about 8,000 per day in 2009 to about 33,359 per day in 2023. The hourly processing capacity in the system is estimated at about 45,000 Funds Settlement Instructions. The primary limit on capacity in RIX is the interface to SWIFT. The Riksbank continuously evaluates whether this capacity needs to be increased further.

In April 2020, Riksbank and the ECB concluded an agreement on the settlement of electronic payments in Swedish krona on the Eurosystem’s real-time infrastructure, TARGET Instant Payment Settlement (TIPS) to support the Swedish instant payment service, RIX-INST.

The future RIX shall offer two services. One service will be called RIX-RTGS and is intended to replace the current RIX. The other service will be called RIX-INST, for instant payments.

In September 2021, the Riksbank took a strategic decision to use the Eurosystem’s platform for settlement of payments, which is known as T2, for large-value payments in Swedish krona. The Riksbank thus intends to replace the current IT platform for RIX with T2 and to investigate the opportunities for this.

P27 Payments Project – Sweden is a member of the P27 payments project, which aims to establish the first integrated region for domestic and cross-border payments across multiple currencies in the Nordics and Scandinavian regions. P27 is an initiative from Danske Bank, Nordea, Swedbank, Handelsbanken, SEB and OP to serve the region’s 27 million people, creating the world’s first integrated domestic and cross border real-time payments platform, a vital step for trade between Nordic countries.

In February 2018, the major Swedish, Danish, Norwegian and Finnish banks banded together to explore the possibility of establishing a pan-Nordic payment infrastructure supplemented by common products, with the aim of making it possible to clear immediate payments and settle accounts within seconds, regardless of currency. The P27 project – so-called for the 27 million people who live in Sweden, Norway, Denmark and Finland – will build on the success of the mobile bank payment apps of the Nordic banks like Swish in Sweden, Norway’s Vipps, and MobilePay in Denmark.

The collaboration reflects an effort to stay ahead of global technology giants like Apple and Samsung as customers no longer rely exclusively on their banks for financial services. The difference between P27 and the payment apps Nordic banks already offer is the cross-border nature of the project.

To facilitate this, P27 acquired the Swedish clearing house Bankgirot in October 2020. Bankgirot manages transactions of a total value of approximately SEK 73 billion per day. In July 2021, P27 Nordic Payments secured merger approval from the EU Commission to establish its pan-Nordic payments platform.

In June 2022, P27 announced that 13 banks connected to Swedish mobile payments system Swish were set to test on P27 by the end of 2022. Banks connected to Swish, which is used by more than 90% of the Swedish population, are at the front of P27’s drive toward processing the platform’s first transactions. The current timeline called for SEK instant preparations to be finalised during H2 2022, followed by SEK batch preparations to be finalised in early 2023.

However, in April 2023, P27 announced the withdrawal of its clearing license from the Swedish Financial Supervisory Authority (Finnsinspektionen) as a result of new requirements and regulations that have challenged its operating model. While this reflects the continuously evolving landscape for payment infrastructure, it poses a major setback to the ambitious vision. Finland and Norway are yet to make formal statements. However, Denmark’s banking sector has decided to proceed with other solutions instead of the P27 project, choosing to pursue an alternative review of modernising the country’s payment infrastructure. Additionally, the Swedish Instant Payment scheme also decided that it will work with other players to modernise the country’s payment schemes.

Nordic KYC Utility – (now Invidem) In June 2018, four Nordic banks decided to explore the possible establishment of a Nordic Know Your Customer (KYC) infrastructure. The banks DNB Bank, Danske Bank, Nordea Bank, Svenska Handelsbanken and Skandinaviska Enskilda Banken established a joint venture, Nordic KYC Utility, with a focus on developing a secure and cost-effective Nordic KYC infrastructure. Swedbank has since become another bank involved in the project.

The company will be owned and controlled by the founding banks. However, the plan is that the company will also offer its services to third parties. The initiative will contribute to ensuring a healthy financial environment, prevent financial crime and to protect customers and society.

In July 2019, Invidem received regulatory approvals in accordance with EU merger control rules and has now established itself as a joint venture company named Invidem, with each bank involved holding an equal share. In April 2020, Invidem signed long-term technology deals with Econompass and iMeta Technologies for automated KYC data-gathering and KYC information management ahead of Invidem’s commercial launch in 2021.

In April 2022, Invidem entered an agreement with Swedish fund management company Indecap Fonder. Indecap Fonder will be the company’s seventh and first non-owner client.

In 2023, Invidem continued to address the growing complexity of managing KYC data, which has become more challenging as global compliance demands increase, prompting enhancements in their secure, cloud-based data processing solutions.

Pan Nordic Card Association (PNC)

On the initiative of Swedbank and Nordea, the major VISA issuers in the region, the Malmo-based Pan Nordic VISA Association was launched in 2003 and later renamed to include Mastercard issuers. The initial aim of the association was to promote integration of card payment systems in the region, with particular reference to EMV migration, which has been hindered by different implementation standards for EMV-capable POS terminals in Denmark, Finland, Norway, Sweden and the Baltics.

In 2023, the members of PNC were Nordea Bank, Swedbank, Danske Bank, Svenska Handelsbanken, SEB, Bambora, Card Payment Sweden, Card Payment Denmark, Bits, and Finance Finland.

The Pan Nordic Card Association Advisory Committee (PNC AC) interprets the rules and regulations of the card schemes and the SEPA Card Framework to harmonise the payment business in the Nordic area. Activities include coordination of SEPA payments and implementation of PCI DSS card security standards.

Bankgirot

As the only clearing house for mass payments in Sweden, Bankgirot has a central role in the Swedish payments infrastructure. In 1959, Bankgirocentralen’s (BGC) operations were founded. In 2012 the company changed its name to Bankgirot. Bankgirot is owned by SEB, Swedbank, Handelsbanken, Nordea, Danske Bank, Skandiabanken and Länsförsäkringar Bank.

In 2011, Bankgirot took over the product ownership for e-invoicing (E-faktura) after previously having been responsible for operation, development and customer service. A new version of Autogiro, where all information is electronic, was launched in November. In total, 791 million payments were processed.

In 2012, Bankgirot launched a new immediate payment system (Betalningar i realtid). The first payment flow to be connected to the new platform was the mobile payment solution, Swish, which was launched in December 2012 by six Swedish banks. Bankgirot manages and develops Swish on behalf of Getswish AB.

In October 2020, the bank-owned project P27, the cross-border payment infrastructure initiative for the Nordic region, announced its acquisition of Bankgirot.

Immediate Payment Service Swish

In December 2012, the Swedish banks Danske Bank, Handelsbanken, ICA Banken, Länsförsäkringar Bank, Nordea, SEB, Swedbank, Sparbankerna, Sparbanken Syd, Sparbanken Öresund and Skandia launched the immediate payments service Swish operated by Getswish AB. Bankgirot manages and develops Swish on behalf of Getswish AB.

Swish includes a mobile payment app which enables private individuals to send money to other users in real time by connecting mobile phone numbers to bank accounts. To use the service, individuals need a smartphone, a secure Swedish mobile Bank ID and the mobile Swish app. If the receiver has a phone with the Swish app, a notification is displayed within a few seconds. The maximum amount varies by bank, but is often SEK 10,000, which can be increased.

In January 2016, Swish for Commerce was launched. There are now three solutions for immediate payments: Swish Private (P2P payments), Swish Business (C2B payments from a person to a company, association or organisation), and Swish for Commerce (for e-commerce and m-commerce transactions).

From January 2017, QR-code initiated in-store payments are available to all Swish users. When a QR-code is scanned, the payment information is filled out automatically and only needs to be approved by Mobile BankID.

Swish Use – By 2023 Swish reported that more than 8 million Swedes were using Swish, and that Swish is the preferred method for online payments by Swedes aged 18-40. In 2022, based on Riksbank and Swish figures, there were 1.01 billion Swish payments, up by 27.69% from 2022. In 2023, the total Swish payments value amounted to SEK 507 billion, and there were on average 96.0 Swish payments per capita.

According to Riksbank, in 2023 Swish usage increased amongst elderly people. People over the age of 65 use Swish the least compared with other age groups, in relation to the total number of Swish payments, both as regards Swish payments from private persons to companies and transfers between private individuals. However, in April 2020, people over the age of 65 made 70% more Swish payments to other private persons than in the same month of 2019.

On 1 July 2020, an amendment was made to the Consumer Credit Act with the aim of making it less attractive to shop on credit. The amendment entails that, if other payment alternatives than credit are possible when shopping online, they must be displayed before the credit alternative. Swish reported that the number of traders joining Swish increased since the decision to amend the Consumer Credit Act became official.

In 2021, Swish launched payouts and an app for companies incorporating QR codes. As of September 2023, there were 8.69 million private users of Swish, and 306,040 companies offering payments via Swish. Between 2020 and 2021 there was an 80% increase in the use of QR codes used for payments via Swish.

5 – Swish Key Figures

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Note: all figures taken from Swish graphs and therefore estimates.

Card Issuers – Overview

Swedish banks issue contactless credit cards, charge cards, debit cards and prepaid cards in combination with bank accounts. Addressing the specific needs of personal banking and business banking, the card portfolio is composed of consumer cards, business cards and corporate cards.

Dedicated card products are offered for the individual client segments: families, millennials, students, affluent clients, small business clients, corporate clients and even basic account clients. The credit cards offered range from classic cards to gold cards and platinum cards.

Most Swedish retail banks issue VISA and Mastercard branded debit, delayed debit, and credit cards. Swedbank had been the American Express card issuer while SEB Kort is the issuer of Diners and Eurocard cards.

Leading issuers are Swedbank Group, SEB, Svenska Handelsbanken and Nordea. Other issuers include EnterCard, SEB Kort, American Express and retail-owned ICA Banken, Ikano Bank, Medmera Bank and the petrol company Statoil. American Express Payments Europe now issues American Express cards on its own. Table 6 illustrates the card brands issued by the leading issuers in Sweden as of mid-2023.

6 – Leading Card Issuers in Sweden

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Note: cards issued include combined credit/debit cards branded Mastercard or VISA
Source: PCM research

Outlook – By mid-2024, Swedish card issuers face the following notable challenges:

Card Processors and PSPs

In Europe, the payment processing industry is composed of card processors, ATM/POS network hub processors, e-/m-payment service processors (PSPs), and specialised processors (e.g. CSM processors, TSM services).

In Sweden, card issuer processing services range from technical issuer processing, including card printing, to full cardholder processing services. They include all types of cards and card technologies allowing for card use in multi-channels (i.e. at ATMs, POS terminals, on the internet and in-store mobile payments in the future).

Acquirer processing services in the country range from technical acquirer processing, including POS terminal services, to full merchant processing services. Usually, ATM/POS network processing is part of acquirer processing while payments on the internet are routed by specialised e-/m-payment service processors (PSPs) to the card acquirers and independent payment service providers (e.g. FinTechs like PayPal), respectively.

For Sweden’s banks, with their regional focus, national-based processing systems have become an increasing anachronism. Accordingly, there has been consolidation and development of new structures in recent years. As part of the liberalisation of the Swedish card business, the interbank organisation CEKAB was sold and the Swedish banks agreed to establish a jointly owned company, Bankomat AB, to support the Swedish ATM network.

Leading card processors are NETS and Tietoevry. The Swedish banks processed cards either in-house or using processing services from Tietoevry or NETS, the pan-Nordic processor.

The domestic, as well as international card payments, are processed and cleared by their respective international card schemes and then settled by the Swedish CSM mechanisms.

Tietoevry – In February 2007, when the Swedish bank shareholders of CEKAB (Centralen För Elektroniska Korttransaktioner AB), their collectively-owned card processor, agreed its sale to the Oslo-based, publicly-quoted IT services group, EDB Business Partner. In June 2010, EDB merged with Ergo and was renamed EVRY in March 2012. In March 2015, private equity company Apax Capital acquired EVRY.

After being delisted in 2015, EVRY was relisted on the Oslo stock exchange on 21 June 2017, and the IPO was one of the largest IPOs in the Nordics during 2017.

In June 2019, Tieto and EVRY announced their merger, creating one of the most competitive digital services and software companies in the Nordics. The merger was completed in December 2019.

Following the Tietoevry merger completion in December 2019, the combined company is present in more than 90 countries, with annual turnover of €3 billion.

Background – CEKAB began life in 1989 as a switch for domestic ATM transactions. Following liberalisation, POS transactions were transferred to CEKAB for authorisation and switching. CEKAB was connected to POS terminals in merchant outlets. All the major banks in the past used CEKAB for at least some of their POS transaction processing, but it was not clear to what extent this would continue under EDB’s ownership.

NETS – The Swedish banks, through their Norwegian and Danish banking interests, also supported NETS, the merger between PBS and BBS (see Denmark profile), with Nordea undertaking to consolidate its card acquiring transaction processing in Denmark, Norway and Sweden through NETS.

In September 2008, NETS signed a three-year agreement with SEB Kort’s Euroline, which routed all its Nordic acquiring transactions through NETS. The agreement replaced Euroline’s separate agreements with BBS in Norway and PBS in Denmark.

In March 2014, the private equity investors Advent International, ATP and Bain Capital signed an agreement to acquire 100% of the share capital of NETS from the existing shareholders, a group of 186, primarily Danish and Norwegian banks, for $3.1 billion (see Denmark profile).

In August 2014, Irish payments network Payzone sold its Swedish subsidiary to NETS. In December 2014, NETS said it was chosen by the largest banking and insurance group in Sweden, SkandiaBanken, to process the bank’s issuer services related to Skandia’s payment cards. In December 2014, NETS acquired 87.2% of the shares in Swedish PSP DIBS Payment Services. Also, NETS acquired the Finnish PSP PayTrail.

In September 2016, NETS applied for an Initial Public Offering (IPO) in a partial share sale valued at $2.36 billion. In October 2016, the new shareholder structure was composed of AB Toskana (39.9%), the joint 50/50 venture of Advent and Bain Capital, Black Rock (7.4%), and other investors (52%) below the 5% threshold, including ATP.

In February 2016, Nets launched tokenised mobile payments in the Baltic region. NETS Group uses a turnkey tokenisation platform, Token Processing Appliance (TPA), which supports both HCE NFC payments and SIM SE NFC payments.

In September 2017, NETS agreed a $5.3 billion bid from private equity investor Hellman & Friedman (US). Effective 2 February 2018, NETS was delisted from Nasdaq Copenhagen. As at 7 February 2018, indirectly through Evergood5, H&F Corporate Investors VIII controlled 65.57% of the total share capital and 93.87% of the total voting rights in NETS (including treasury shares), respectively. Under Danish law, the remaining minority shareholders were requested to transfer their shares in NETS to Evergood5 (94.1%).

In June 2018, NETS and German-based acquirer and merchant service provider Concardis Payment Group agreed their merger structured as a share exchange which will see Concardis Group’s private equity shareholders, Advent International and Bain Capital, contribute their shares in return for NETS shares. Concardis was valued at €700 million in a transaction with Bain and Advent in January 2018. Concardis Payment Group includes Croatian Mercury Processing Services International.

Also, in June 2018, NETS expanded into Poland through a €73 million acquisition of online payment providers Dotpay/eCard. Closing is expected in Q4 2018.

In August 2019, Mastercard entered into an agreement to purchase the Real-time Payments Platform (RPP) from NETS for $3.2 billion. This follows Mastercard’s decision to enter the P27 consortium in the Nordics (see above).

In 2020, NETS processed more than 40 million payment cards for more than 240 banks, and over 740,000 merchants. In addition, NETS managed 500,000 terminals and all Nordic payment modules for online shopping are connected to their card platform. Measured in terms of authorisations and card transactions, the number of transactions in 2020 amounted to around 7.7 billion on the entire NETS platform – the group also manages over 9.1 million digital identities. NETS was said to have a 30%-35% share of the card processing market in the Nordic region.

In November 2020, Italian processor Nexi confirmed its intention deal to buy NETS for €7.8 billion, with the signing of a merger deal taking place in June 2021. The completion of the transaction was subject to approval from Finnish regulator FIN-FSA and closed in June 2021. The merger of Nexi and NETS creates Europe’s largest payments firm by volume and number of customers.

In November 2023, Nexi sold its Nordic eID business to French digital ID outfit IN Groupe for up to €127.5 million.

The sale comprises an array of trust services in Nordics and key parts of the eID infrastructure in Denmark, MitID and NemLog-in, which serves as a personal entrance key to both the public sector and most parts of the private sector, including banks and corporates.

The sell off is part of a commitment by Nexi to rationalise its operations and concentrate purely on its core digital payments business.

Online Payment Service Processors (PSPs) 

Online payment service processors (PSPs) are specialised technical processors for all kind of secure online payments and mobile payments. Some of them also offer virtual PSP platform services (VPSP) for bank acquirers who want to take advantage of a kind of ‘internet network processor’.

Online shops of merchants are directly connected by an API interface or a hosted payment page either to the internet payment gateway of a bank acquirer, or they are connected to multi-acquirers through a PSP.

PSPs usually partner with more than one card acquirer and payment initiation service providers. Core services offered by PSPs may include payment gateways to card acquirers and other online payment service providers, online payment processing, risk management services, and collection services for merchants.

Security technologies applied to ensure secure online card payments include EMV tokenisation and strong 3D-Secure (MCSC, VbV, SafeKey) combined with one-time tokens. For card-less payment services, the security technologies applied include userID/password combined with one-time tokens and online banking access with one-time TAN.

Leading payment service providers (PSPs) for e-payments and m-payments in the Nordic region is NETS. Other PSPs active in Sweden include Worldline, Swedbank, Paynova, Payson, Klarna, Qliro, PayEx (N), InPay (DK), AltaPay (DK), Clearhaus (DK), and CNG (DK).

Like other countries, not only the domestic PSPs and acquirers, but also cross-border acquirers and foreign PSPs, are actively servicing Swedish online merchants:

Nordic API Gateway (Aiia) acquired by Mastercard – in 2019, Nordic API Gateway received a PSP licence from Danish regulatory authorities. Nordic API Gateway is an API that connects to all Nordic banks and enables integration of accounts and transactions data from real users. As of 2020, more than 50 customers are already live with solutions for banking, payments and many other use cases. In Sweden, bank clients include Danske Bank, Handelsbanken, ICA Banken, Nordea, SEB, Skandia, Sparbankerna, Swedbank and Ålandsbanken.

In April 2021, Nordic API Gateway changed its name to Aiia, and in September 2021, Mastercard expanded its Open Banking reach with the acquisition of aggregator Aiia, which offers a direct connection to banks through a single Open Banking API.

Payson was founded in 2004. The main purpose was to enable easy and secure payments for online businesses and consumers. Payson is one of the leading payment services in Sweden, serving more than 2.5 million customers and 10,000 merchants. Payson is a part of Svea Ekonomi AB, since 2012.

Digital River World Payments – Digital River World Payments (DRWP), a global payments service provider founded in 1997 and headquartered in Stockholm, acquired cards that ran on the Discover Global Network.

In June 2017, Worldline (B) acquired 100% of the share capital of Digital River World Payments (DRWP), the PSP from Digital River Inc., a global provider of Commerce-as-a-Service solutions. Worldline integrated DRWP in Worldline’s Merchant Services Global Business Line. The transaction closed in Q4 2017.

PayEx is an online payment service provider comprising of a number of companies in Sweden, Norway, Denmark and Finland. PayEx offers payment solutions for internet, mobile and physical commerce as well as administrative services within billing, account management and debt collection. PayEx also offers financial services such as factoring, instalment and loans.

In May 2017, Swedbank acquired PayEx, a Norwegian PSP. The transaction closed in August 2017.

Background Processing Liberalisation – Since the Swedish card market was liberalised with the launch of duality in 1995, VISA Europe has cleared and settled domestic POS transactions for the Swedish banks.

Following an agreement with Nordea and Swedbank in April 2007, VISA processes authorisations of ATM and POS transactions on VISA cards issued by the two banks as well. The new arrangements began once Swedbank completed its ‘common payment gateway’ project, enabling ‘on-us’ transactions to be processed in-house, with Nordea transactions being passed on to VISANet. The gateway was operational at end-2007 for acquiring and 2008 for issuing processing. Authorisation of transactions such as a Nordea VISA card used at a merchant POS acquired by Swedbank, or a Nordea VISA cardholder’s withdrawal at a Swedbank ATM, are now processed by VISANet.

Liberalisation also created the need for a clearing and settlement system able to cope with the introduction of domestic interchange arrangements. For clearing and settlement, the Swedish banks used VISANet to handle domestic as well as international transactions. Originally, VISANet handled all domestic transactions on Swedish VISA cards as well as Swedish Eurocard/Mastercard cards but clearing and settlement of domestic transactions on Eurocard and Mastercard cards was transferred to EPSNet (now Banknet) in April 2001. The use of VISANet before April 2001 for all transactions only applied to Swedish-issued cards. All foreign cards used in Sweden were cleared and settled through VISA or Mastercard (formerly Europay) depending on the brand.

Acquiring and Card Acceptance 

In Europe, most acquirers offer multi-channel card acceptance and value-added merchant services at POS terminals, mobile MPOS terminals and online shops. The leading acquirers usually act on a European level and offer their services cross-border.

Additionally, innovative acquirers also offer the acceptance of card-less payment services based on partner agreements with the issuer of those payment services (e.g. account-based payments, wallets, prepaid products).

Most acquirers either operate their own acquirer systems and ATM/POS/MPOS network service hubs, or they use the processing services of external processors. In order to service online merchants in Europe, they may operate their own PSP processing platforms or they co-operate with one or more specialised online payment service processors (PSPs).

From 2009, European acquirers compete in their home markets, cross-border on a European level, and cross-channel at POS terminals and servicing online merchants. From 2016, innovative acquirers started to offer omni-channel and multi-payment acceptance.

By mid-2024 omni-channel acceptance includes the ability to service all channels (i.e. POS/MPOS terminals, mobile in-store, online shops, in-app), and to accept multiple payment means in all of these channels. Multi-payment services demanded by merchants include cards, IBAN-based payments (SCT, SDD), online wallets, digital wallets, prepaid products, and immediate payments.

Outlook – By mid-2024, Swedish acquirers face the following notable challenges:

All major Swedish banks have been card acquirers. In May 2014, SEB sold its acquiring businesses, including SEB EuroLine, to private equity investor Nordic Capital. Also, the Danish/Norwegian bank owners of NETS sold NETS Group to the private equity investors, including the acquirer business unit Teller.

In June 2015, NETS acquired Nordea Merchant Acquiring – the section of Nordea’s payment business dealing with acquiring of international payment cards in the Nordic and Baltic regions – for a price of €230 million on an enterprise value basis. NETS Group offered acquirer services, operating under the Teller brand, for around 700,000 merchants across the Nordic and Baltic region. In 2020, NETS Group operated in more than 20 countries through cross-border activities, before being acquired by Nexi in 2021.

Acquirer Background – Before liberalisation in the mid-1990s, the savings and commercial banks operated separate acquiring and processing systems. The savings banks acquired and processed their own transactions through BABS. The commercial banks acquired collectively through a joint venture company called SERVO.

Following liberalisation, all the major Swedish banks have become acquirers. Market shares vary depending on the measures used. But Swedbank has a market share of around 50%, with Nordea and SEB each having approximately 15%. In November 2006, PBSI (now Teller) bought the Swedish acquiring business from Danske Bank.

Smaller merchants tend to buy or rent stand-alone POS terminals directly from terminal vendors. Larger, and increasingly medium-sized merchants, have their own terminals as part of integrated EFTPOS systems.

In 2023, the leading acquirers are Swedbank, Worldline, and NETS. The other acquirers include Elavon Merchant Services, Handelsbanken, and Sparbanken Öresund. American Express and SEB Kort are among the largest acquirers in Europe ranked by transaction numbers.

Bambora (now Worldline) acquired Diners cards licensed by SEB Kort, which owns the Diners Club franchise for the Nordic region. Swedbank acquires JCB cards, and American Express acquires its own cards. In January 2019, Diners Club International, a part of the Discover Global Network signed an agreement with NETS, to help expand Discover Global Network acceptance in Norway, Sweden, Denmark and Finland. Table 7 illustrates the card brands accepted by the leading domestic acquirers as at mid-2023.

7 – Leading Acquirers in Sweden

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Note: In July 2021. Handelsbanken sold its acquiring business in the Nordic region to Worldline.
Source: PCM research

Swedbank BABS – Swedbank, with its extensive network of branches in smaller towns and villages, has a strong presence in the SME market. In 2023, Swedbank acquired around 3.64 billion transactions across Europe, for a total purchase value of $97.5 billion. Swedbank’s network comprised 99,129 merchant outlets and 196,677 POS terminals as of 2020. In 2016, UnionPay signed an agreement with Swedbank to extend its acceptance network across Swedbank’s extensive POS network in Sweden. In 2019 Swedbank announced the launch of Swedbank Pay, a merger between BABS and PayEx, a provider of virtual terminal solutions for e-commerce. In October 2019, Swedbank Pay and Verifone partnered to offer payment solutions to SME merchants in Sweden, Norway and Denmark by combining Swedbank Pay´s card acquiring with Verifone´s terminals. As part of the deal, Swedbank also announced it would divest its 49% share in BABS Paylink to Verifone which has been co-owned with Swedbank since 1999.

Handelsbanken – in 2020, Handelsbanken acquired around 553 million transactions for a total purchase value of $21.4 billion. Its network comprised 28,288 merchant outlets and 44,713 POS terminals.

In July 2021, Handelsbanken entered into an agreement to sell its card acquiring business to Worldline. In 2020, the business had net commission income of approximately SEK 190 million and external costs of approximately SEK 20 million. In conjunction with the sales agreement, Handelsbanken also entered into a distribution agreement with Worldline. The compensation to Handelsbanken for the sale is approximately SEK 2,000 million. The deal was completed in October 2021.

Bambora – Though primarily the SEB credit card issuer, SEB Kort had been the acquirer of SEB through its SEB Euroline operation, which operates a central acquiring business in Europe; customers include SAS, the Scandinavian airline, and KLM, the Dutch airline.

In May 2014, SEB agreed to sell its Euroline card acquiring business to private equity investor Nordic Capital for SEK 2.2 billion, and SEB Euroline was rebranded as Bambora. In May 2015, the Bambora Group (S) launched its new brand and platform as a Nordic-based payment service group. In 2016, Bambora claimed to service 110,000 customers and processes a transactions value of €55 billion per year, of which more than 70% were online and mobile.

Bambora was created by combining the payments companies Euroline, KeyCorp, Samport, MPS, DK Online and ePay, all acquired by Nordic Capital between May 2014 and April 2015 with the ambition to form a leading player within the payment service sector. In September 2015, Bambora acquired Beanstream Internet Commerce (CND).

In July 2017, Ingenico Group (F) acquired Bambora from Nordic Capital for $1.74 billion, expanding the PSP unit Ingenico ePayments and the acquirer unit Ingenico Payment Services into the Nordic region. The transaction was closed in November 2017.

During 2019, Bambora acquired around 594 million transactions for a total purchase value of $24.9 billion. Its network comprised 70,503 merchant outlets and 67,080 POS terminals. In October 2020, Bambora became part of Worldline, due to Worldline’s acquisition of Ingenico, and as of September 2021 the Bambora business was fully absorbed into Worldline, with the Bambora name ceasing to exist.

Elavon Merchant Services – In September 2004, SEB Kort sold its acquiring interests in Norway, originally obtained with the purchase of Europay Norge, to euroConex (now Elavon), the Irish-based pan-European processor. That raised doubts over SEB’s future commitment to acquiring at that time.

MSC Fees in Sweden – The pricing of card transactions to merchants has been a crucial issue in the Swedish market in recent years. Banks and merchants in Sweden began arguing about interchange and MSCs in 1995, when the banks attempted to introduce a service fee for debit card transactions. A complaint by retailers to the Konkurrensverket, the Swedish competition authority, was upheld on the grounds that the banks had acted in a coordinated way. Headed by Swedbank, the banks were forbidden to use fallback prices for interchange or to impose any ‘non-discrimination’ rule on card payments.

Since July 1995, merchants have been able to surcharge customers who pay by bank cards as well as credit cards. Interchange issues are relatively settled, although a number of Swedish travel agents impose surcharges on credit card transactions. However, surcharging is no longer allowed for consumer card payments as the EU interchange fee regulation applies.

Payment Institutions

As of 31 December 2022, there were 53 payment institutions resident in Sweden and licensed by Finansinspektionen (2021: 56, 2020: 48, 2019: 43, 2018: 33, 2017: 36, 2016: 32, 2015; 28, 2014: 24, 2013: 25, 2012: 24, 2011: 23) authorised in another EEA member state. Additionally, 249 cross-border payment institutions provided notification of operating in Sweden under the EU passport system. Most of the institutions report payment services taking the form of remittance business.

ATM Terminal Infrastructure

There are two types of ATM in Sweden – the commercial banks’ Bankomat ATMs and the saving banks’ Minuten ATMs. The EMV migration of ATM terminals is complete, since end-2011.

Bankomat AB – In 2010, Danske Bank, Handelsbanken, Nordea, SEB, Swedbank and Sparbankerna agreed to establish a jointly-owned company, Bankomat AB, to support the Swedish ATM network. The company was founded via BDB Bankernas Depå AB, with each participant holding 20% of the shares and sharing investment costs. In 2021, Bankomat AB operated 1,063 shared ATMs belonging to Nordea, Danske Bank, Handelsbanken, SEB and Swedbank. In 2023, Bankomat reported having ATMs in almost 600 locations in Sweden

In 2012, Swedish ATMs were upgraded to enable bank customers in Sweden to use any ATM for all services supported by their bank, something which was only possible on the ‘home’ network.

Swedish ATM terminals are open for debit cards (Debit Mastercard, Maestro, Cirrus, VISA Debit, Electron, Plus and V PAY) and credit cards (Mastercard, VISA, American Express, Diners, Discover, and JCB). Up to mid-2013, no Swedish ATM was activated for withdrawals on China UnionPay cards.

Despite Sweden’s reputation as a leading non-cash market, as of January 2021, the new Riksbank cash law came into force, which stipulates that banks must ensure that private individuals do not have to venture far from home to the nearest place to withdraw cash.

In December 2016, the Riksbank Committee was tasked with reviewing cash management, cash provision and contingency planning in the Swedish payments system. In November 2019, the Swedish government adopted legislation under which certain large credit institutions – currently the six largest banks in Sweden – would be obliged to provide certain cash services throughout Sweden from 1 January 2021 onwards. The purpose is to ensure a certain minimum level of access to cash services for consumers and companies. In 2021, Bankomat announced that it had established ATMs in 17 new locations in response.

In 2023, there were 2,049 ATMs (down 3.71% from 2022) and 50.5 million cash withdrawals (-11.14%) with a total value of SEK 72.1 billion (-12.49% from 2022). There were 2,053.0 withdrawals per ATM per month, down 7.72% from 2022, and the ATV per ATM cash withdrawal accounted for SEK 1,427.69, equivalent to €124.38

8 – ATMs and Cash Withdrawals in Sweden

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Source: ECB, Sveriges Riksbank.

Cash-advance Services in Sweden – Competition for ATMs 

In an Open Banking ecosystem, the dominant role of ATMs for cash withdrawal services may decline as more cash-advance and cash handling services are offered at retail outlets in Europe.

Cash in-Store – In parallel with ATM cash withdrawals on cards, Swedish banks consider supporting cash-advance services on cards at POS terminals in retail outlets (see below).

ATM charges – One of the factors sustaining cash use is a free and open ATM network. Though there were historically two ATM networks – the savings banks’ Minuten network and the commercial banks’ Bankomat network – cardholders can use any machine. None of the major banks charges customers for using their debit cards in other banks’ machines.

Sweden is affected by EU regulation 2560/01 which requires parity of charges on domestic and cross-border transactions in euros. Though currently outside the euro zone, the Swedish government has chosen to opt into the regulation.

The regulation affects Swedish banks because Sweden is a net exporter of ATM transactions. Its cardholders form part of the holiday traffic phenomenon of movement from northern to southern Europe. Charges for ATM withdrawals by Swedish cardholders when visiting euro zone countries have been an important source of revenue for the Swedish banks.

The euro zone accounts for 70% of international ATM transactions on Swedish cards, according to Swedbank. The regulation means banks lose the revenue from international ATM transactions but must still bear the interchange and other costs.

POS Terminal Infrastructure

The POS statistics indicate a progressive switch from cash to card use in Sweden. Between 2011 and 2016, the number of EFTPOS terminals grew by 23.0%. For the period 2019 to 2023, however, that growth rate (CAGR) had declined by 5.47%. Furthermore, these statistics may only cover bank-administered terminals, and there has been substantial growth in recent years from the integrated EPOS systems of large retailers and fuel companies, along with mobile POS terminals and softPOS solutions used by merchants.

The two Swedish POS networks are operated by Swedbank BABS and EVRY. Other banks process their POS terminals in-house or through local POS network service concentrators and service providers like e.g. Point. The EMV migration of POS terminals achieved 88% by end-2011 and was completed in 2012. POS terminals are required to be both EMV-compliant and BABS CEKAB approved (BCA).

POS terminals are either provided by the acquirers or, typically, Swedish merchants buy or lease them directly from the terminal suppliers. Swedbank BABS terminals are managed by BABS Paylink, a joint venture between Swedish terminal provider Verifone Sweden (51%) and Swedbank BABS (49%). BABS Paylink offers a terminal leasing service to merchants and works with cash management companies on behalf of its clients. In 2018, Verifone Sweden acquired the remaining 49% of its terminal distributor joint venture with Swedbank, BABS Paylink.

There are EFTPOS terminals and other POS terminal types integrated with the electronic cash register systems (ECR) of the merchants. The majority of POS terminals are either directly connected to Swedbank BABS and TietoEVRY or indirectly through POS network service processors like Posten or terminal concentrator hubs of retailers like ICA and KF (Swedish Coop) and petrol companies like Statoil.

Accepted card brands at Swedish POS terminals are debit cards (Debit Mastercard, Maestro, VISA Debit, Electron and V PAY), and credit cards (Mastercard, VISA, American Express, Diners, Discover and JCB). UnionPay cards have been accepted at selected POS terminals frequented by tourists and their acceptance network is expanding following deals with Teller and Swedbank BABS Paylink (now Verifone).

In 2023, the country had 207,935 POS terminals (+0.23% from 2022). The one-time peak in number of terminals in 2016 is believed to be an impact of phasing-out non-contactless POS terminals. The decline from 2011 and 2012 was an impact from phasing out old magnetic stripe terminals. In 2015, Sveriges Riksbank changed its statistical reporting. Thus, figures from 2015 can’t be compared to figures of previous years.

In 2023, there were 3.035 billion POS payments (-0.04%) with the total value SEK 965.0 billion (same from 2022). There were 1,216.7 card payments per POS terminal per month, and the ATV per POS payment on cards accounted for SEK 317.87, equivalent to €27.69.

9 – POS Terminals in Sweden

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Source: ECB, Sveriges Riksbank.

VeriFone Sweden (previously Point) is the Swedish provider of payment and gateway services and solutions for retailers and offers a full range of electronic payment services in northern Europe and the Baltic states. In 2013, the Point group claimed to service more than 250,000 clients and to support 700,000 payment devices and 20,000 e-commerce sites.

In January 2012, VeriFone announced it had completed the acquisition of Point including e-payment service provider and PSP processor PayBox France. VeriFone intends to extend the Point platform throughout the Nordics and beyond, with the aim of creating the world’s largest infrastructure for rapid deployment of alternative payments and NFC mobile commerce. Point operates now as VeriFone Sweden. In 2022, Verifone claimed to connect 26 million Swedish “paypoints” – including laptops, mobile devices, PCs, payment terminals, cards, etc – to its cloud-enabled system.

MPOS Terminals – Small and mobile merchants have started to use their smartphone and tablet PCs as a kind of mini-POS+ECR device with added chip reader dongle. In late 2012, Square clones like iZettle, SumUp, Miura, and others launched MPOS services in Europe. Swedish iZettle was expected to support the Nordic banks. Also, Swedish merchants can initiate MOTO-like card payments on their smartphones and tablets by downloading a payment app.

In December 2012, Nordea Bank in Sweden began to distribute iZettle’s MPOS reader free of charge to its small business customers. In June 2013, NETS launched its MPOS terminal services for small merchants in the Nordic region.

In February 2014, Handelsbanken started to offer VeriFone/Point MPOS terminals in the Nordic region. In March 2014, Ingenico and PSP processor PayEx partnered for Nordic MPOS terminal services dubbed iSMP.

In May 2014, Nordea selected iZettle to be its provider of MPOS terminal solutions in Sweden, Norway, Denmark and Finland. Under the cooperation agreement Nordea promoted iZettle MPOS terminals to the bank’s small business customers on its website and in its 800 Nordic branch offices.

In September 2015, MPOS terminal provider SumUp, which is backed by American Express, launched its card acceptance solution in Sweden. In April 2016, the Berlin-based MPOS vendor Payleven merged with SumUp.

In May 2019, Swedbank led a £4 million investment round in mobile point-of-sale start-up Kaching Retail. Launched in 2017, the Kaching Retail mobile POS terminal is currently used by Ikea and Apple Premium resellers. Swedbank plans to use its investment to beef up its MPOS offerings under the Swedbank Pay product brand, which currently provides services to 100,000 retail customers in the Nordic and Baltic countries.

SmartPOS Terminals – In 2018, POS terminal vendors launched innovative new types of POS terminals. Named SmartPOS terminals, they combine the electronic cash register functionality (ECR) used by merchants in outlets with a contactless POS payment terminal and merchant services in the cloud. For the very first time, the so far separated ECR devices and POS terminals are integrated in just one checkout solution device. From late 2018, SmartPOS terminal vendors like Castles, Clover, Ingenico, Justtide, Handpoint, PAX, Poynt, Verifone, Worldline, and others have launched their SmartPOS devices and services in Europe. It is believed that Swedish SME merchants will embrace SmartPOS terminals.

iZettle, the Swedish e-money institution, and provider of mobile apps and mini chip-card readers like Square in the US, offers its services in the Nordics and in Europe. Similar to Square, Swedish iZettle developed devices for mobile merchants that can be plugged into the dock connector of e.g. an iPhone to accept credit card payments. iZettle turned smartphones and tablets on iOS and Android into mobile credit card terminals accepting Mastercard, VISA, American Express, Diners, and JCB.

With more than 50,000 users in 2012, iZettle claimed to have increased the number of POS terminals in the Nordics by 10% since it began operation in Sweden in September 2011 and expanded to Denmark, Finland and Norway in February in 2012. In June 2012, Mastercard became an investor in iZettle. In October 2012, American Express became the second major card firm investing in iZettle followed by Banco Santander (E) in June 2013.

iZettle’s MPOS reader was EMV-approved and compliant with PCI-DSS standards. In July 2013, iZettle cut its standard 2.75% transaction fee to 1.5% for very small merchant users. In 2014, 0.95% transaction fees were offered.

In February 2015, iZettle launched a free-of-charge Chip & PIN reader for merchant customers across Europe. In May 2015, iZettle began distributing a contactless MPOS terminal in the UK allowing merchants to accept payments on contactless cards, mobile NFC payments and Apple Pay.

In September 2016, iZettle acquired the Scottish MPOS start-up intelligentpos for an undisclosed sum.

From June 2017, iZettle enabled small business owners in Europe to register local mobile payments and send invoices through its point of sale app. This gave iZettle’s users a complete overview of their sales history, ensures compliance with local tax regulations and enables them to sell more. The service is free of charge and opened up for mobile payments from British Pay-By-Bank app, Swedish Swish, Norwegian Vipps and MobilePay in Denmark and Finland.

In April 2018, iZettle launched an e-commerce marketplace for small business owners to sell their wares online. The platform was available in the UK, Sweden, Denmark, Norway, Finland, Germany, France and the Netherlands.

In September 2018, PayPal completed its acquisition of iZettle for approximately $2.2 billion. The company continues to operate under the Zettle brand.

Remote Payments on the Internet – Cards & More

In 2022, Sweden was the largest e-commerce market in the Nordic region with about 8 million people shopping online regularly. From 2015, due to EU VAT regulation, Swedish merchants have to collect the applicable VAT rate for cross-border sales based on the consumers’ residence.

As of 2023, e-commerce value amounted to € 12.60 billion, a decline of 14.29% from 2022. The e-commerce amount per capita in 2023 was €1197.5 while the amount per online buyer was €1,320.0. In 2022, e-commerce amounted to 1.95% of Swedish GDP.

Internet Use – In 2023, 97% of Swedes used the internet, one of the highest levels of internet penetration in Europe, 89% of internet users had purchased online in the last 12 months, and 78% had purchased in online shops in the last three months. 83% of Swedish consumers purchased online from national sellers, and 24% claimed to have purchased from foreign websites.

According to a study by Nets, Sweden had one of the highest percentages of spending on physical goods in 2021 of all Nordic countries surveyed. This sector of the market accounted for 61% of online spending, with most people buying pharmacy items and clothes, followed by beauty products and provisions. Travel, however, was the lowest among all countries surveyed, accounting for just 17% of online spending for the period. By 2022, physical goods still made up 48% of online spending. However, Travel also gained traction and accounted for 36% of spending in 2022. Compared to 2021, spending on travel increased by 87% in 2022 as physical goods took a slight hit with physical goods spend down by 7% from 2021.

In the Riksbank’s survey of the payment behaviour of the Swedish population in 2023, 78% of respondents state that they have purchased goods and services on the Internet in the last 30 days. In 2020, the corresponding figure was 66%. It is most common in the age group 25-44, where 85% state that they had bought something over the internet in the last 30 days.

The Swedish government has a policy of “connected Sweden” whereby there will be 100% connectivity to fast broadband (>1GB/s) by 2025.

10 – Internet Use in Sweden

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Sources: Eurostat, ITU.

Cards on the Internet (CNP) – All cards with international brands are accepted in Swedish online shops if the merchant has signed an acceptance contract accordingly. Also, the Swedish banks issue prepaid cards and virtual cards for internet use only. 3D-Secure technology is applied for most payments with cards online. Further, web-based mail order services for merchant-initiated payments and Dynamic Currency Conversion (DCC) are offered.

The e-Payment Mix in Sweden – In 2023, the Swedish e-payment mix ranked by consumer preference continued to be dominated by invoicing (34%), cards (25%), Swish (24%), direct payment by internet banking (9%), PayPal (5%) and Apple Pay (2%).

In early 2020, the updated Credit Act law took effect, which removed credit alternatives as the default payment option on e-commerce websites. Instead, electronic payment methods need to be displayed first. Since the adjustments were made public, the number of traders who have joined the payment service Swish has increased by 50%.

Remote Payments on the Mobile Internet – Since 2009, online buyers with a high affinity for smartphones have started to use their mobile phones for shopping on the mobile internet. Mobile online shops can be accessed by mobile internet, by mobile app, or by scanning a 2D QR-code displayed in a newspaper or at a bus station. Thus, remote mobile phone payments are executed either by using the e-payment page of the mobile online shop or by using payment apps of a PSP or an acquirer.

Also, merchants can download a payment app from their acquirer in order to initiate MOTO payments with cards and/or online direct debits. Leading Swedish merchants are testing their own mobile apps including loyalty functions (e.g. e-vouchers, discounts, outlet finder, QR-code scanning) and direct debit payment functions.

As of 2021, the Swedish mobile commerce market was worth around €8 billion, with half of all e-commerce purchases carried out on a mobile device rather than at a desktop computer. Tablet use in general is low in Sweden. Mobile commerce is typically used for lower-value purchases, and the average transaction value is 33% less than transactions carried out on a desktop.

Mobile Payments – Overview

In 2023, 140.0% of Swedes subscribed to a mobile phone. Many Swedes own more than one mobile phone. Some 84% own a smartphone (up from 63% in 2013), and 65% of the population own a tablet PC.

Sweden Mobile Payment Market is expected to register a CAGR of 21.3% between 2024 and 2029. Stores and services worldwide are rapidly adopting mobile payment applications, owing to the rapid growth of mobile technology, particularly with the advancement of smartphones. Also, with increasing internet penetration and rapid growth in online retailing, the market is expected to move positively.

Since 2009, the next generation of mobile services and payments has started, pushed by online buyers’ high affinity to smartphones and tablets and, also, by new disruptive technologies (1D-barcodes, QR-code, Bluetooth BLE and Near Field Communication NFC).

Mobile initiatives in Sweden are field testing and using new technologies either as initiating form factors to bridge to online shops on the internet (1D-barcodes, QR-code, NFC) or to enable contactless access to the retail POS outlet (1D-barcodes, QR-code, BLE, Bluetooth Low Energy, NFC Stickers, Mobile NFC Phones) e.g.:

The m-Payment Mix in Sweden – There are no official m-payment statistics, but PSP information indicates that the domestic m-payment mix is similar to the e-payment mix (see Remote Payments on the Internet section).

Mobile Payment Initiatives

In 2024, the various European mobile payment initiatives can be grouped into

SMS Payments – The m-payment service of Swedish mobile operator Telia includes SMS premium payments for ticketing, music and purchase of goods in vending machines and person-to-person money transfer. M-parking is another example of SMS payment services currently in operation in Sweden.

Review – In the period from 2010 to 2016, various mobile SMS payments and contactless SIM SE NFC mobile initiatives were trialled. Although the technology piloted has been experienced as market proven, many of the mobile payment initiatives were phased-out due to slow user adoption. From 2016, mobile payment initiatives in Sweden entered a consolidation phase. Especially, Swedish banks push mobile banking app payments and Swish.

Central Bank Digital Currencies, Cryptocurrency Products 

In 2023, the Swedish payment ecosystem was composed of traditional cash payments, digital cryptocurrency products of independent payment service providers and research and development of central bank digital currencies, CBDC. The regulation of cryptocurrencies is becoming increasingly relevant as independent cryptocurrency products have grown more prevalent, posing challenges for regulators and national central banks.

In July 2023, the European Union introduced the Markets in Crypto-Assets (MiCA) regulation, which aims to standardize cryptocurrency regulation across member states, including Luxembourg. This regulation addresses various aspects of crypto assets, such as market integrity, consumer protection, and financial stability, while also promoting innovation in the sector. Under MiCA, crypto-asset service providers will have specific obligations to protect users’ wallets and mitigate investment risks.

Central Bank Digital Currencies (CBDC) – The Digital Cash Challenge 

Central bank digital currency (CBDC), also called digital fiat currency or digital base money, is a digital currency issued by a national central bank (NCB), rather than by a commercial bank. It is also a liability of the NCB and denominated in the sovereign currency, as is the case with physical banknotes and coins.

All CBDCs are under the authority of the respective national central bank, and they are part of the domestic cash payment ecosystem. Rather than a new currency, CBDC is a form of central bank electronic money that could be used by households and businesses to make payments. In addition, most CBDC implementations will likely not use or need any sort of distributed ledger such as a blockchain.

Unlike “retail CBDC,” which is generally designed as a central bank liability universally accessible to individuals and businesses within a jurisdiction’s financial system, “wholesale CBDC” refers to a digitized central bank liability designed for sizable (generally interbank) transactions, and for which access is limited to certain financial institutions.

National Central Banks (NCBs) have been providing trusted money to the public for hundreds of years as part of their public policy objectives. Trusted money is a public good. It offers a common unit of account, store of value, and medium of exchange for the sale of goods and services and settlement of financial transactions. Providing cash for public use is an important tool for central banks. Yet the world is changing.

Even before COVID-19, cash use for payments was declining fast and convenient digital payments have grown enormously in volume and diversity. To evolve and pursue their public policy objectives in a digital world, central banks are actively researching the pros and cons of offering a digital currency to the public, a “general purpose” CBDC.

Central banks’ interest in CBDC has increased as a potential means of delivering their public policy objectives. Profound, ongoing changes across finance, technology and society, as well as the recent COVID-19 crisis, provided additional impetus for the research of, and experimentation related to, CBDCs.

CBDC is a national digital currency issued by the central bank that is expected to replace or coexist with fiat money and hold the same value. Mobile money, on the other hand, utilises existing commercial banking-based accounting to manage customer wallet balances based on an exchange with cash or lines of credit and loans.

CBDC is a direct liability on the central bank as it is the main issuer of the currency, whereas digital money is the liability of commercial banks and other authorised financial institutions using funds on account. Although some implementation approaches propose that CBDC can be implemented in either an indirect or hybrid form, its liability remains on the respective national central bank.

Background on CBDC Evolution

In October 2020, the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, Sveriges Riksbank, the Swiss National Bank and the Bank for International Settlements (BIS) published a report, Central bank digital currencies: foundational principles and core features, identifying the foundational principles necessary for any publicly available CBDC to help central banks meet their public policy objectives.

The report focused on a publicly available “general purpose” CBDC (a digital payment instrument, denominated in the national unit of account, that is a direct liability of the central bank).

A “wholesale” CBDC, restricted to financial institutions, is also an active area of exploration, notes the report, for central banks but one that carries different opportunities, challenges, and risks. The report explored the use cases for, and challenges and opportunities arising from, the possible issuance of a general purpose CBDC.

In September 2021, the same seven central banks and the BIS followed up with the publication of a new set of reports exploring the potential of retail CBDCs, including policy options and practical implementation issues. While none of the central banks has yet decided to proceed with a retail CBDC, they recognise such an instrument would have wide-ranging implications. Delivering on the future needs of consumers would require systems that encourage innovation, choice and competition among a diverse mix of intermediaries.

BIS reported that a 2021 survey of central banks found that “86% are actively researching the potential for CBDCs, 60% were experimenting with the technology and 14% were deploying pilot projects.

The People’s Bank of China (PBoC) is piloting a ‘digital yuan’, known as e-CNY, in various cities, often in association with major sporting events, such as the Winter Olympics.

The ECB published a paper on the potential of a “digital euro” in October 2020, exploring the “benefits and risks” of such an initiative. It completed a public consultation in January 2021 and a series of focus groups in December 2021. Its investigation stage is expected to continue until October 2023, after which the ECB “will decide whether to start developing a digital euro.”

The US Federal Reserve reported in February 2022 that while it has made no decisions about “whether to pursue or implement” a CBDC, it was “exploring the potential benefits and risks of CBDCs from a variety of angles and was inviting public feedback on discussion papers.

The Bank of Japan said in October 2020 that it had no plans for a CBDC and was committed to maintain the cash system as long as there was public demand for it. It nevertheless intended to explore technical feasibility through a proof of concept, consider institutional arrangements and coordinate approaches with domestic and international stakeholders. In 2023, the Bank of Japan (BOJ) has announced that it will begin a pilot for its digital yen with commercial financial institutions. In February 2023, Bank of Japan has embarked on a CBDC trial.

In June 2023, the BIS and BoE said they completed a CBDC pilot project involving CBDCs jointly run by the Bank of England (BoE) and the Bank of International Settlements (BIS). Project Rosalind was designed to explore how a “universal and extensible API layer” could connect central bank and private sector infrastructures and enable retail CBDC payments. The project also sought to develop a number of retail-CBDC use cases.

According to the BIS and BoE, the project has successfully demonstrated that “a well-designed API layer could work with different private sector applications and central bank ledger designs and that a set of simple and standardised API functionalities could support a diverse range of use cases”.

In all, the project led to the development of 33 API functionalities and examined 30 retail CBDC cases including peer-to-peer transfers, retail payments for goods and services and small-value business transactions.

While CBDCs are still in experimental phases across major economies, 2024 has seen increased momentum towards real-world implementation, with several countries, notably China and the ECB, moving closer to full-scale rollouts. Public-private collaboration, technological innovation, and privacy concerns remain central to future CBDC development. Central banks worldwide continue to balance innovation with maintaining public trust and financial stability in this rapidly evolving space.

Global Status of CBDCs 

Most National Central Banks (NCBs) are involved in different stages of a CDBC project. Especially, the NCBs have different views on which kind of CDBC they would intend to launch as a digital currency:

As of 2024, Central Bank Digital Currencies (CBDCs) are gaining significant traction globally. Over 130 countries are actively exploring CBDCs, with 11 having fully launched them. These include – Nigeria (e-Naira), Eastern Caribbean (D-Cash), Jamaica (JAM-DEX), and the Bahamas (Sand Dollar) among others. Each country has its approach, with most leaning toward retail CBDCs designed for public use, while some also explore wholesale CBDCs for large-scale, interbank transactions.

Six countries have launched a CDBC pilot: France, Canada, China, India, Saudi Arabia, and Ghana.

The NCBs of most other countries are involved in either a CDBC proof-of-concept phase – including Norway, Hungary, and Sweden – or they are still in a CDBC research stage

So far, Ecuador is the only country that has cancelled its CBDC ambitions, Dinero electronico.

CBDC, the European Union and the Digital Euro

In July 2021, the Estonian Central Bank released a report about its experiment with the ECB and the central banks of Spain, Germany, Italy, Greece, Ireland, Latvia, and the Netherlands to assess the functionality of the digital euro. The project was able to conduct 300,000 transactions per second, with an average rate of less than two seconds per transaction.

In June 2023, the European Commission (EC) has published its legislative proposal establishing the legal framework for a possible digital euro, stressing that the CBDC would be a compliment to, not replacement for, cash.

A digital euro would be available alongside existing national and international private means of payment, such as cards or applications. It would work like a digital wallet, with people and businesses able to pay with it anytime and anywhere in the euro area.

The digital euro would be available for payments both online and offline. While online transactions would offer the same level of data privacy as existing digital means of payments, offline payments would essentially be like paying with cash – with nobody able to see what people are paying for.

The digital euro would be distributed by banks and other payment service providers, with basic services provided to people free of charge. Merchants would be required to accept the digital currency unless they are cash-only firms.

The EC’s proposal still needs to be adopted by the European Parliament and the European Council before the European Central Bank decides whether to roll out a digital euro.  Notably, the European Central Bank (ECB) is involved in the preparation phase, which will run until 2025. During this time, technical experimentation and legal discussions are ongoing before any formal rollout decisions can be made​.

Pros and Cons of CBDCs

According to research by the Bank of England, BIS, and by several other central banks, the benefits of CBDCs include supporting increased innovation in the payment system with:

Possible challenges related to use of CBDCs could include:

The ECB commissioned multiple exploratory reports on the feasibility of a digital euro in 2020 and 2021. The ECB’s working paper suggests a two-tier system for a “general purpose” CBDC. In July 2021, the ECB announced that it would launch a 24-month investigation phase for the digital euro project, which aims to address key issues regarding the design and distribution of a digital euro. The investigation phase will include focus groups, prototyping and conceptual work. In February 2022, the European Commission announced that it will propose a bill that would serve as the legal foundation for the issuance of a digital euro by the ECB. In May 2022, Christine Lagarde stated that she would be willing to back the digital Euro. By June 2023, the ECB and European Commission had significantly advanced their legislative and technical work, moving closer to launching a pilot phase for the digital euro in 2024. The pilot phase is expected to assess the practical implementation of the digital euro, following the completion of the current investigation period​.

The working paper states that the use of CBDC for retail payments is the primary use-case for the development of a digital Euro. The paper also rejects the motivation of using CBDC as a store of value, which would involve consumers switching deposits from commercial banks into CBDC. The working paper also recommends that a CBDC should be interest-bearing, with attractive interest rates offered for smaller sums suitable for payments and lower rates available for larger amounts.

CBDC and Sweden

As of 2020, the Riksbank stated that it had started to test a technical solution in a pilot phase for a digital e-krona. The objective of the project is to develop a proposal for how the Riksbank could issue SEK in digital form and make it available to the general public. The solution is based on SEK in digital form, issued by the Riksbank (e-kronas), being distributed via participants in a decentralised network that, in turn, mediates the e-kronas to the end-users, private individuals and companies.

As of mid-2021, the Riksbank stated that it would continue its work on investigating the need for and effects of an e-krona on the Swedish economy. The Riksbank will also start the work of preparing for a possible procurement of an issuable e-krona. In May 2021, it was announced that Sweden would trial a CBDC with Handelsbanken in a test environment.

Within the framework of the project, a technical solution was created for distributing Swedish kronor in electronic form (the e-krona) to the public in a test environment. The e-krona has similarities to cash, and the technical solution (the e-krona network) in which the e-krona circulates has similarities to how the Riksbank distributes banknotes and coins to the public today.

During phase one of the project, which ran from February 2020 to February 2021, a test environment was created to simulate how a payment with an e-krona could function. Here, simulated participants in the network could order e-kronas from the Riksbank that simulated end-users could buy and keep in a digital wallet. A mobile app also enabled end-users to make payments, deposits and withdrawals. They could also make payments with cards and smart watches.

In April 2022, the Riksbank released the findings of phase two of the project, in which the bank was successful in testing offline functionality and integrating banks and other payments providers into the system.

In parallel, Sweden’s Ministry of Finance launched an inquiry on whether the e-Krona should be launched in Sweden in 2020, which is still underway. The inquiry is to consider the need to issue a CBDC, and to review the concept of the term legal tender in a world where cash is used less and less. The inquiry is also to survey the allocation of roles on the payment market between the state and the business sector and to take a stance on the future role of the state. The report from the inquiry was presented in March 2023, and it states that there is currently insufficient social need for the Riksbank to issue a central bank digital currency in the form of an e-krona.

In 2023, the Riksbank advanced the e-Krona project by studying its economic implications, refining its technical framework, and conducting user studies aimed at end-users and traders. By early 2024, the Riksbank entered a new phase of testing involving collaboration with other central banks on cross-border functionalities for the e-krona, which aligns with global trends toward cross-border digital currency frameworks.

Cryptocurrencies EU

The regulation of crypto assets and related services across Europe is not standardised and is highly fragmented. While no nation has outright banned usage of cryptocurrencies like Bitcoin, Ethereum and others, regulators have not formed a consensus over how to legislate such a quickly fluctuating market, where new cryptocurrencies emerge faster than regulators can catch up to.

The current approach across Europe is to adapt existing legislations to encompass cryptocurrencies, however, this is unlikely to be efficient as consumer and business usage changes.

In the European Union, the fifth Anti-Money Laundering Directive (AMLD5) covers certain crypto assets under the term “virtual currencies”, but it does not provide a harmonised approach. As a result, each Member State has created its own regulatory regime for transactions related to “virtual currencies” or crypto assets

In response, the European Commission proposed the Markets in Crypto-assets (MiCA) regulation in 2020 as part of the Digital Finance Strategy, with MiCA expected to come into force in 2022 and will be directly applicable in all Member States after an 18-month transition period. MiCA will result in a harmonised set of rules for products and services and legal certainty related to crypto assets throughout the European Union in 2024. This would enable a larger number of investors to be active in this area and to use distributed ledger technology (DLT).

MiCA is to apply to all persons who want to issue crypto assets or provide services related to crypto assets in the EU.

The MiCA proposal is intended to lay down uniform rules on transparency and disclosure requirements for the issuance, offer to the public and the admission to trading of crypto assets. In addition, there are rules on the authorisation and supervision of crypto asset service providers and their issuers.

The main focus lies with the issuers of asset-referenced tokens and e-money tokens. The Regulation intends to regulate the operation, organisation and governance of issuers of asset referenced tokens and e-money tokens and crypto asset service providers. There will also be investor protection rules for the issuance, trading, exchange and custody of crypto assets. In addition, measures to prevent market abuse are to be included in the Regulation to ensure the integrity of the crypto assets markets.

In June 2022, the EU Council President and European Parliament reached agreement on MiCA regulation, ruling that crypto asset service providers will require authorisation to operate in the EU, not including NFTs or media-related digital assets.

Under the agreement, the regulatory framework will protect investors and consumers, while ensuring financial stability and enabling innovation and growth. The regulations will help protect consumers from fraud and scams, as crypto asset service providers will be liable if they lose assets and fail to protect investors’ wallets. The European Banking Authority (EBA) will form a public register of non-compliant crypto asset providers.

The regulation will also implement restrictions on stablecoins, with stablecoin issuers to be supervised by the EBA and their “holders will be offered a claim at any time and free of charge.”

Recent updates in 2024 have introduced detailed procedural standards for cooperation between national regulatory authorities (NCAs), enhancing their ability to oversee, investigate, and inspect crypto asset service providers. This framework ensures more consistent and transparent enforcement across EU jurisdictions, including stronger measures to prevent market manipulation and fraud.

MiCA’s comprehensive framework is expected to encourage more institutional investors to enter the crypto market, while providing a safer environment for retail investors. It also addresses environmental concerns by mandating transparency on the climate impact of certain crypto assets.

Unregulated Cryptocurrency Products – Background 

Regulators and national central banks are challenged by unregulated independent cryptocurrency products. Whereas CBDCs are under the authority of the central bank, almost all cryptocurrencies are decentralised, and not controlled or managed by any central authority.

Obviously, financial market authorities and the national central banks are not in favour of unregulated cryptocurrency products, and they see them as a systematic risk for the financial system. Their intention to regulate the respective cryptocurrency exchange platforms has gained momentum.

Cryptocurrencies, originally designed as a store of value, are digital assets, developed and maintained on decentralised blockchains, and they can be used as a medium of exchange or payment method. Bitcoin and Ethereum are the most popular forms of cryptocurrencies worldwide used by consumers and businesses for transactions.

As of 2023, over 600 million people worldwide used cryptocurrencies, with merchants and businesses in more sectors accepting it as a form of payment. The major payment schemes VISA and Mastercard, PayPal and along with a growing number of financial institutions, have launched services allowing consumers to purchase or use cryptocurrencies for a range of applications.

According to a 2022 Deloitte survey, around two-thirds (64%) of surveyed merchants indicated that their customers have significant interest in using digital currencies for payments, and 83% expect consumer interest in digital currencies for payments to increase or significantly increase over the next 12 months.

In addition, merchants are motivated by the prospect of enabling immediate access to funds (40% of respondents), taking advantage of blockchain-based innovations in decentralised digital finance (39%), and allowing in-house management of the revenue cycle/treasury/finance department (39%).

Over half (54%) of large retailers (with revenues of $500 million and up) have invested more than $1 million on enabling digital currency payments, while only 6% of small retailers (with revenues of under $10 million) did so.

A 2022 survey from Checkout.com found a sharp rise in people wanting to use cryptocurrencies as a means of payment, with 40% of 18-35-year-old consumers citing their desire to experiment with using crypto as a payment method, up from less than 30% in 2021. Meanwhile, over 80% of businesses say offering crypto has attracted new customers, led to a decrease in chargebacks, while just over 60% have seen higher authorisation rates accepting crypto payments.

A recent report by Triple-A put cryptocurrency ownership in Europe at around 49 million people.

Stablecoins

Stablecoins are a type of asset-backed cryptocurrency, whose value is typically pegged to the value of an underlying asset such as USD, GBP, or commodities like gold. Stablecoins are partially backed by real assets, and they are designed to have a value pegged to real-world assets, therefore avoiding the extreme volatility that affects cryptocurrencies.

Stablecoins offer the potential benefits of cryptocurrencies, like transparency, security, immutability, and decentralised control, while maintaining the guarantees and stability that come with using fiat currency. Stablecoins have potential to be used in cross-border payments, providing a secure, online environment for peer-to-peer (P2P) transactions to take place without needing decentralised cryptocurrencies or to pay fees to convert money into local currencies.

As of 2024, there were more than 200 stablecoins globally, comprising a market that’s worth approximately $174 billion.

A survey of central banks in January 2021 found that two-thirds of respondents are actively researching the potential impact of stablecoins on financial stability. However, some regulators in the US and China, consider stablecoins as a potential serious risk to financial systems. The risk is especially high with centralised coins, such as those backed by fiat and issued by private organisations, as economic power would be disproportionately concentrated on a single entity.

The widespread use of stablecoins in payment platforms could also pose a systemic risk, in relation to the validation and confirmation of stablecoin transactions which could interfere with payment systems. If stablecoin users couldn’t access money in their e-wallets and businesses couldn’t receive payments, economic activity would be greatly disrupted. However, these risks have not deterred major institutions like JP Morgan and VISA to explore stablecoin use cases via partnerships and internal R&D.

Tether As of 2024, Tether remains the largest stablecoin globally, holding a market share of over 50%. This dominance is driven by its widespread usage and liquidity in crypto markets. Its nearest competitors include USD Coin (USDC), Binance USD (BUSD), and decentralized stablecoins like DAI, although Tether’s market share far exceeds them. Recent reports have shown Tether’s involvement in major financial markets and even Bitcoin mining, further reinforcing its stronghold on the crypto landscape.

Regarding Facebook’s Diem (formerly Libra) project, it was officially abandoned. Diem’s assets were sold off to Silvergate Capital in early 2022, marking the end of the initiative that once aimed to create a globally accessible digital currency. Regulatory pressures and internal challenges led to the dissolution of the project.

Market Size and Dynamics

Cards in Issue

Specific to the Swedish card business is the issuance of combined debit/credit cards with two card functions on one card. Therefore, the number of payment functions on cards is higher than the total cards number.

In 2015, Sveriges Riksbank changed its statistical reporting. Therefore, many card numbers from 2015 can’t be compared to respective figures of previous years.

There were 1.63 cards with cash function per capita at end-2023. However, there were 1.73 cards with payment functions per capita.

By end-2023, the number of cards issued with payment functions was 18.16 million (-0.02%). There were 11.06 million cards with a debit function, while the number of cards with a credit function was 6.53 million, with Nordea and Swedbank focusing on this card segment. Charge cards (delayed debit in the ECB figures), mainly issued by SEB, have reached 0.53 million. Cards with a debit function lumped together accounted for 63.87% of the cards total. Including DD/CC functions on cards, credit card functions on cards accounted for 35.99% of the total card base.

11 – Cards Issued in Sweden

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Note: ‘delayed debit cards’ include now ‘debit and/or delayed debit’, credit cards include now ‘credit and/or delayed’ debit’.
Source: ECB, Sveriges Riksbank.

Card Fraud

Card fraud is one of the most fascinating aspects of the payments industry, not least because it is relentless and mutating. EMV implementation and 3D-Secure, combined with Strong Customer Authentication (SCA), have done much to reduce domestic losses from lost and stolen cards in Europe. However, the war against fraud losses and the changing face of fraud continues to be a threat for the payments industry, including Sweden.

The global card fraud challenges are Card-Not-Present fraud (CNP), cross-border fraud, and counterfeiting on non-EMV cards. CNP fraud accounted for 80% of the total value of card fraud losses in 2020. From 2017, a new payment fraud category are fraud losses on contactless card payments. International card fraud continues to be smaller in scale than domestic card abuse but is proportionately far more common. And of course, fraudulent cross-border transactions on cards continue to grow on all purchase channels.

Losses from card fraud on the internet and cross-border fraud on domestic cards have grown significantly. Following EMV implementation, card fraud has moved increasing to countries where POS terminals or online shops have not yet been migrated to EMV and SCA, respectively, and to cross-border fraud with compromised cards.

The breakdown of card fraud losses by method of compromise already indicates the importance of distinguishing between domestic and cross-border fraud losses. The method of compromise covers the means by which fraudsters obtain payment cards or card details. Notable methods of compromise in a complex payment world are CNP fraud based on theft of card credentials and card lost and stolen fraud followed by growing ID fraud and by cross-counterfeit fraud.

The main method of compromise responsible for losses in many European countries is now the theft of card credentials. A high proportion of these card fraud losses are caused by the growth in e-commerce, and still the lack of use of strong customer authentication methods such as 3D-Secure.

In a post data-breach world, identity information, payment credentials, account credentials and responses to security questions are widely available for purchase in bulk. Complete fraud exploits and zero-day attacks are also easily available on the black market for outright purchase or as a hosted / fully managed service.

In the digital payments world and having the changing face of fraud in mind, there are significant challenges for card issuing banks, payment service providers and their supporting processors.

The Nordic region has been experiencing a large increase in CNP fraud and Sweden is no exception with a steady growth of the loss line. The Swedish market has also been facing a rise in cyber-enabled digital fraud, most specifically scams such as invoice fraud and push-payments fraud.

Sweden’s card fraud loss mix is aligned with European trends. According to the Riksbank, in 2021, the number of card frauds in Sweden declined. During H1 2021, the number of police reports regarding card fraud declined by 27%, compared with the same period in the previous year. The greater part of the decline is due to the number of registered card frauds without the physical card, for instance in card purchases online, having declined by 28% in relation to the same period in the previous year.

In 2022, according to Riksbank, the number of card frauds in Sweden is relatively low compared to other countries in Europe. In addition, the number of reported cases of card fraud was said to have fallen in recent years. One explanation for this is that, since 1 January 2021, Sweden has been applying the EU regulations on requirements for Strong Customer Authentication. The requirement for Strong Customer Authentication applies regardless of whether a card is swiped, a chip is used, or a contactless payment is made. However, in certain cases, such as low value payments, an exemption may be made to the requirement for Strong Customer Authentication.

The Swedish National Council for Crime Prevention carries out the Swedish Crime Survey (NTU). In the latest survey, self-reported exposure to card/credit fraud amounted to 3.7% of the population (aged 16–84) in 2022. This is a slightly higher level compared to 2021 (3.5%). As all cards now have EMV chips and the magnetic strips are seldom used, fraud in shops and ATMs has decreased sharply. Fraud is now most common in e-commerce, where CNP fraud, particularly outside the EU, dominates.

According to FICO card fraud losses in Sweden amounted to SEK 233.4 million in 2022, with CNP fraud comprising SEK 193.6 million and lost or stolen card fraud at SEK 21.3 million.

12 – Card Fraud Losses on Swedish Cards

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Source: FICO, Euromonitor International.

As most POS card transactions are authorised online-to-issuer, acquirer fraud rates in Sweden are under control except for offline vending machines, e-commerce and a few other hotspots. Obviously, EMV implementation has contributed significantly to declining fraud rates.

Swedish banks are pushing 3D-Secure, offer PIN-change services at ATMs and SMS notification to inform cardholders about the use of their credit card. The increasing numbers of chip technology cards, contactless cards and display cards have led to improved safety of payment transactions. Credit card fraud prevention measures taken have been pushing 3D-Secure, updating banks’ fraud prevention systems and real-time-scoring and implementing more rule-based fraud control mechanisms.

According to ECB figures published in October 2021, the value of fraud as a share of transactions with cards in Sweden in 2020 was 0.019% by value and 0.006% by volume.

In 2020, from an issuing perspective, CNP fraud accounted for 80% of all card fraud by transaction channel, with POS fraud comprising 13% and ATM fraud 7%.

In 2020, from an acquiring perspective, CNP fraud comprised 80% of all card fraud by transaction channel, with POS fraud comprising 17% and ATM fraud comprising 3%.

In 2019, FICO reported a moderation in CNP losses in Sweden thanks to the use of BankID to confirm identity in transactions. However, it also noted that the Swedish market is seeing a vast increase in the rate and losses associated with social engineering and scams fraud. Given the higher net loss associated with these fraud typologies vs plastics, FICO expects to see a big drive in the market to improve digital controls in order to prevent these frauds.

As most POS card transactions are authorised online-to-issuer, acquirer fraud rates in Sweden are under control except for offline vending machines, e-commerce and other hotspots.

Credit card fraud prevention measures taken have included pushing 3D-Secure, updating banks’ fraud prevention systems and real-time-scoring, implementing more rule-based fraud control mechanisms. Also, Swedish card issuers offer PIN selection at ATMs and SMS notification to inform cardholders about the use of their credit card.

Card Use 

The use of cards for payments has grown strongly. It is above the EU average, though below that in other Nordic markets. In 2015, Sveriges Riksbank changed its statistical reporting. Therefore, many card payment volumes and values from 2015 can’t be compared to the respective figures of previous years.

The impact of the COVID-19 pandemic can be seen in all card usage metrics, with sharp declines in cash withdrawals and steep increases in online payments, although recovery was underway in 2021.

In 2023, there were 3.98 billion payments on cards (+3.08%) with a total value of SEK 1,306.3 billion (+4.86% from 2022). The ATV per card payment was SEK 327.87 (€28.56), and there were on average 219.4 payments per card per year. Debit card payments amounted to 81.56% by number and 70.61% by value.

Included in the card payments total in 2023 were 558.8 million remote payments on cards in online shops (+5.52%) with a total value of SEK 225.2 billion (-7.93% on 2022). In total 14.03% of all card payments and 17.24% of the total card payments value were made on the Internet.

13 – Payments with Swedish Cards

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Note: ‘delayed debit cards ‘ include ‘debit and/or delayed debit’, credit cards include ‘credit and/or delayed’ debit’.
Note: Sveriges Riksbank changed its statistical reporting: figures from 2015 can’t be compared to figures of previous years.
Source: ECB, Sveriges Riksbank.

Cash withdrawals with Swedish cards – In 2023, there were 17.11 million cards with a cash function in circulation. There were 98.6 million withdrawals on cards (-10.16%) compared with 3.98 billion payments on all cards. The withdrawals value on cards amounted to SEK 146.4 billion (-10.94% from 2022). The ATV per cash withdrawal on cards was SEK 1,484.72 (€129.34), and there were 5.8 cash withdrawals per card per year.

14 – Cash Withdrawals with Swedish Cards

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Note: Sveriges Riksbank changed its statistical reporting, therefore figures from 2015 can’t be compared to figures of previous years.
Source: ECB, Sveriges Riksbank.

Card Use Per Capita 

In 2023, card payments per capita were 378.7 (+3.08% from 2022, 5-year CAGR of 1.66%), the fourth highest level in Europe after Iceland, Norway, and Denmark).

Debit card payments per capita achieved 320.1 payments while credit cards payments accounted for 54.1 payments per capita. In addition, there were 9.4 cash withdrawals per capita.

15 – Card Payments Per Capita in Sweden

[ninja_tables id=”5054″]

Note: ‘delayed debit cards ‘ include ‘debit and/or delayed debit’, credit cards include ‘credit and/or delayed’ debit’.
Source: calculated using ECB data, population and exchange rates.

Debit Card Use 

From 2019, Riksbank now reports all delayed debit cards as debit cards, a factor which alters the statistical patterns observed.

In 2023, there were 3.36 billion debit card payments (+3.66%) valued at SEK 982.87 billion (+6.56% vs 2023). The ATV per debit card payment accounted for SEK 291.80 (€25.42), and there were 300.8 payments per debit card per year.

Market Share: Mastercard and Visa are the leading issuers of debit cards in Sweden, with Mastercard holding a 59% market share, followed by Visa at 39%.

16 – Payments with Swedish Debit Cards

[ninja_tables id=”5055″]

Source: ECB, Sveriges Riksbank.

Credit Card Use 

In 2015, Sveriges Riksbank changed its statistical reporting. Therefore, many credit card payment volumes and values from 2015 can’t be compared to respective figures of previous years.

In 2023, there were 569.6 million credit card payments (up 0.42% vs 2022), valued at SEK 282.53 billion (up 0.56% from 2022). The ATV per credit card payment accounted for SEK 496.01 (€43.21), and there were 88.8 payments per credit card per year.

17 – Payments with Swedish Credit Cards

[ninja_tables id=”5056″]

Note: Swedish credit card figures include those for credit/delayed debit cards.
Source: ECB, Sveriges Riksbank.

E-Money Use

According to Sveriges Riksbank, the use of e-money accounts accessed through a card continued to be marginal. In 2022, there were 32,000 e-money accounts accessed through a card (2021: 32,000, 2020: 32,000, 2019: 46,000, 2018: 59,000, 2017: 78,000, 2016: 131,000, 2015: 122,300).

Leading Card Issuer Details

SEB – Of the major banks, SEB has the oldest pedigree and the most international card business. It founded Eurocard in the late 1950s as a European response to Diners Club and has been market leader in the Nordic T&E sector ever since. SEB issues contactless credit cards branded VISA or Mastercard, contactless debit cards branded Maestro or VISA Debit, and prepaid cards. SEB issued as well Diners Club cards and Eurocard cards co-badged Mastercard. SEB reported 3.6 million cards as at end-2023, down from a high of 4.1 million in 2017.

With the merger of Mastercard and Europay, SEB retained exclusive rights to the Eurocard brand as a programme brand in Sweden. The Eurocard brand appears on the front of the cards as a card brand, with Mastercard as the acceptance brand. SEB, through SEB Kort, also holds the Diners Club franchise for the entire Nordic region. Its flagship programme, with SAS, combines a Diners Club card with SAS EuroBonus points and offers access to Diners Club lounges worldwide.

SEB Kort – SEB’s card business, SEB Kort, was separately incorporated in 2001 and is active in all four of the major Nordic markets. In October 2002, SEB Kort acquired Europay Norge, including the Eurocard brand in Norway. This was followed in June 2004 by its purchase of the Eurocard brand and portfolio from PBS International in Denmark. In 2008, SEB Kort extended operations into Finland and Latvia, where it launched Eurocard programmes, and then into Estonia and Lithuania. In January 2014, SEB Kort bought Eurocard Oy from NETS Oy. In 2015, SEB bought DNB’s corporate card portfolio in Norway.

SEB Kort increasingly operates from a pan-Nordic platform. Though all front-end operations are local, SEB Kort’s IT operations for the Nordic region are centralised in Sweden. Its market share in charge/T&E cards is estimated to be more than 50%. In 2022, SEB Kort had an estimated 2.2 million credit cards and 1.6 million debit cards in circulation.

In September 2006, SEB integrated its card activities into its retail banking division, effective at the beginning of 2007. At end-2010, SEB reported 3.3 million charge, credit, debit and co-branded cards issued, with a total of 435 million transactions in Sweden, up 11% on the previous year. In 2008, SEB reported 526 million transactions, on credit and charge cards for the group as a whole. In the past, SEB has said 70% of transactions were in the Nordic region. SEB provided no subsequent update on card transaction volumes.

Swedbank describes itself as Sweden’s largest card issuer, with 4.5 million cards as at end-2023, unchanged from the previous year. Across the Swedbank Group there were 8.4 million cards in circulation as of end 2023, including Estonia, Latvia, and Lithuania. Card brands issued are VISA, which is the core debit brand, Debit Mastercard, Maestro, Mastercard credit cards, and VISA credit cards. Swedbank has a network licence agreement with American Express and had issued American Express cards, from 2000 up to end-2019. From 2016, new and renewed cards are issued as contactless cards.

The number of Swedbank card purchases in Sweden was affected by the COVID-19 outbreak and decreased by 7% from 2019. The total number of card transactions acquired by Swedbank decreased by 5% year-over-year.

Svenska Handelsbanken reported no specifics on its card operations for 2023, even less so than in 2008, when it said only that the number of cards, purchase volume per card, and number of card transactions all increased. Total purchase volumes for Allkort cards, Bankkort debit cards and Business cards grew by 11% then. Handelsbanken Finans, which is responsible for group card services, issues contactless VISA and Mastercard branded Allkorts, while contactless Bankkorts are branded VISA, Mastercard, or Maestro

Before 2006, Svenska Handelsbanken described its card operations as “not quite up to the rest of the market.” But in 2006, its Allkort was claimed to be the credit card with the highest turnover per card in the whole of Europe and the total number of Allkort credit cards in circulation was 179,000, up by 20% on the previous year.

Handelsbanken is a part owner of Bankomat AB, a leading operator within cash handling in Sweden. Most of Handelsbanken’s card customers can also withdraw cash at almost 1,261 ICA shops around Sweden, with no purchase required.

Nordea Bank Sweden issues contactless debit cards branded VISA Debit, Electron, or Debit Mastercard, credit cards branded VISA or Mastercard, and prepaid cards. At end-2022, it was estimated that cards issued totalled 2.2 +million debit cards and 0.6 million credit cards.

EnterCard – A key development in February 2005 was formation of the joint venture company EnterCard, owned 60% by Swedbank and 40% by Barclays, to sell and distribute credit cards in the Nordic market. EnterCard began life with 600,000 card accounts in Sweden and Norway which were transferred into the joint venture by Swedbank.

EnterCard’s stated objective is to become market leader in the Nordic region by offering competitive cards and card-based consumer credits, with market potential assessed as more than 10 million cards. EnterCard operates in Denmark, Norway and Sweden. However, by 2023 it claimed a 20% share of the Nordic card market.

Since its formation, EnterCard has clocked up a number of significant credit card deals. In June 2006, EnterCard signed an agreement with FDB in Denmark, to offer a combined membership and credit card to FDB customers (see also Denmark profile). This was followed in 2008 with a Mastercard credit card programme, ‘LO Plus Guldkort,’ for members of the LO labour union.

In 2009, EnterCard made its first move into Finland with PAM, the country’s second-largest union with 210,000 members. The eight-year agreement provides for EnterCard to offer PAM members a combined membership and credit card from Q3 2009. At end-2008, EnterCard also launched a British Airways VISA co-branded card in Sweden which accrues BA Air Miles on all purchases.

In 2019 EnterCard and Coop Sweden formed a partnership under which EnterCard would issue credit cards to Coop’s Swedish members. In addition to the same basic functionality as Coop’s previous cards, the new cards include contactless payments, e-invoice and extended insurance.

Santander Consumer Finance Nordic (previously GE Money Bank), the consumer finance specialist, issues Mastercard cards. In June 2014, Banco Santander Consumer Finance (E) signed a definitive agreement to acquire GE Money Bank AB and its consumer finance business in Sweden, Denmark and Norway for around €700 million. In 2022, Santander Consumer Finance Nordic had an estimated 1.1 million customers in the Nordic region.

Retail Cards

Retail and fuel cards are particularly important in the Swedish market, with an estimated 10 million cards in issue. Banking legislation was liberalised in the late 1990s, allowing approved retailers to accept deposits as ‘Förskottsbetalning’ or pre-payments for customers’ monthly shopping.

ICA Banken – ICA, the biggest Swedish retailer, launched its banking subsidiary, ICA Banken, in 2001 with the philosophy of “a fair interest rate on current accounts, unambiguous terms and low fees.” ICA Banken has had a full-service offering since 2007, with some services provided by outside partners. Its large store network allows customers to make deposits and withdrawals in almost any ICA store in Sweden. ICA Banken issues Mastercard cards, Maestro cards and ICA private label cards. At the end of 2023, ICA Bank had around 850,000 customers, and an estimated 820,000 ICA cards were in circulation.

A popular ICA innovation is its ‘Förskottsbetalning’ scheme, enabling cardholders to deposit funds without limit to pay monthly in advance for purchases. Among the major events of 2016 was the launch of ICA Bank Corporate, a business bank tailor made for ICA retailers and ICA stores. Its offering includes financial services such as payment solutions, company bank cards, investments, liquidity management and various financing solutions.

Statoil is the Nordic region’s biggest petrol services group, operating in nine countries; ICA provides convenience stores in many of its outlets. Statoil Mastercard, the flagship co-branded programme, is issued by SEB Kort in Sweden and by Nordea in Norway. The card is fee-free and gives cardholders a bonus of 0.5%-1% on all purchases except at rival petrol stations. On petrol purchases at Statoil outlets, a discount of 15% is automatically deducted at the point of payment, whether unattended or over the counter.

There has been no recent update on card numbers, but in mid-2004, Statoil had issued 900,000 private label cards – 500,000 to consumers and 400,000 fleet cards – which accounted for 45% of its petrol sales. Including Mastercard, VISA, American Express and bank debit programmes, cards accounted for 78% of sales. On launching its SEB Kort programme, Statoil’s stated objective was to have 200,000 cards by 2007 and to be “the best, largest and most well-known co-branded card in Sweden.”

MedMera Bank – KF, the Cooperative Union (Coop), is the second biggest force in Swedish retailing after ICA. In 2007, KF relaunched banking operations as MedMera Bank, after the name of its reward scheme. Every member receives a MedMera card; there were 3.5 million members as at end-2022. KF added a VISA MedMera card to its product range in 2007 and also offers credit to members linked to the cards. The bank recorded 310,000 Mastercard products issued by the end of 2022, which had been provided to more than 200,000 of its customers. It also processes over 500,000 transactions from Coop stores every day.

As well as payments, Coop MedMera cards serve as proof of membership and offer cardholders the option of scanning their own purchases in-store. Reward vouchers with total redemption value of SEK 450 million were issued to members in 2008.

MedMera has linked to its debit cards the fast-growing Bistånd på köpet (aid by automatic rounding up) service, allowing every purchase made on the card to be rounded up to the nearest whole krona and the add-on donated to charitable causes.

Ikano Bank, the banking offshoot of Ikea, operates in ten countries – Austria, Denmark, Finland, Germany, Norway, Poland, Russia, the Netherlands and the UK – in addition to Sweden, where it issues IKEA private label, VISA and Mastercard cards. During 2010, Ikano Bank signed cooperative deals with Shell in Norway and Sweden, taking over responsibility for the Shell Mastercard portfolios in both countries from Citibank. Ikano also took over Citi’s consumer finance portfolio in Denmark.

Volvofinans Bank is also a credit card issuer, marketing and administering the Volvo dealerships’ loyalty card – the Volvo Card, which can have a Mastercard co-badging. It also issues the Volvo Truck Card. As of year-end 2023, there were around 373,727 active card accounts from 384,978 in 2022.

The Volvo CarPay app, which was launched in 2016, has over 700,000 users. New features like checkout, i.e. payment, after service or repair visits, which customers, for example, can make from home using their mobile phone, have already been launched.

Data Tables

1 – Leading Swedish Banks 2023

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Note: In October 2018 Nordea Bank moved its head office from Sweden to Finland.
Note: lending and deposits are to/from the public (households, companies, local government).
Source: Swedish Bankers’ Association.

2 – Swedbank Group Key Figures

[ninja_tables id=”5041″]

Note: figures cover Swedbank Group – Swedish savings banks, partly-owned banks and all Swedbank operations abroad.
Note: digitally active customers are those that have made at least 3 log-ins to a digital channel in the last month.
Source: Swedbank.

3 – Cashless Payment Transactions in Sweden

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Source: ECB, Sveriges Riksbank.

4 – Average Exchange Rates

[ninja_tables id=”5043″]

Source: ECB.

5 – Swish Key Figures

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Note: all figures taken from Swish graphs and therefore estimates.

6 – Leading Card Issuers in Sweden

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Note: cards issued include combined credit/debit cards branded Mastercard or VISA
Source: PCM research

7 – Leading Acquirers in Sweden

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Note: In July 2021. Handelsbanken sold its acquiring business in the Nordic region to Worldline.
Source: PCM research

8 – ATMs and Cash Withdrawals in Sweden

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Source: ECB, Sveriges Riksbank.

9 – POS Terminals in Sweden

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Source: ECB, Sveriges Riksbank.

10 – Internet Use in Sweden

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Sources: Eurostat, ITU.

11 – Cards Issued in Sweden

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Note: ‘delayed debit cards’ include now ‘debit and/or delayed debit’, credit cards include now ‘credit and/or delayed’ debit’.
Source: ECB, Sveriges Riksbank.

12 – Card Fraud Losses on Swedish Cards

[ninja_tables id=”5051″]

Source: FICO, Euromonitor International.

13 – Payments with Swedish Cards

[ninja_tables id=”5052″]

Note: ‘delayed debit cards ‘ include ‘debit and/or delayed debit’, credit cards include ‘credit and/or delayed’ debit’.
Note: Sveriges Riksbank changed its statistical reporting: figures from 2015 can’t be compared to figures of previous years.
Source: ECB, Sveriges Riksbank.

14 – Cash Withdrawals with Swedish Cards

[ninja_tables id=”5053″]

Note: Sveriges Riksbank changed its statistical reporting, therefore figures from 2015 can’t be compared to figures of previous years.
Source: ECB, Sveriges Riksbank.

15 – Card Payments Per Capita in Sweden

[ninja_tables id=”5054″]

Note: ‘delayed debit cards ‘ include ‘debit and/or delayed debit’, credit cards include ‘credit and/or delayed’ debit’.
Source: calculated using ECB data, population and exchange rates.

16 – Payments with Swedish Debit Cards

[ninja_tables id=”5055″]

Source: ECB, Sveriges Riksbank.

17 – Payments with Swedish Credit Cards

[ninja_tables id=”5056″]

Note: Swedish credit card figures include those for credit/delayed debit cards.
Source: ECB, Sveriges Riksbank.

Digital & Card Payment Yearbooks