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THE CASHLESS SOCIETY

BANKS

Norway’s second largest bank abandons cash

Scandinavian banking bank Nordea will stop handling cash in its Norwegian branches from Monday, in the latest move towards a cashless society in the Nordic region.

Norway's second largest bank abandons cash
From Monday, no Nordea branches will handle cash. Photo: Gorm Kallestad / NTB scanpix

Announcing the plans on Friday, Norway's number two bank said the move was prompted by falling demand. Only one payment in twenty in Norway is made using notes or coins. This is fewer even than in neighbouring Sweden, which has attracted global attention for its rapid move towards electronic transactions.

The bank described the move in a statement on Friday as an “important strategic step into the digital world”. Handling cash exposes bank staff to security risks and makes it hard for banks to comply with money laundering laws, it claimed.

Only one Nordea branch, Oslo Central Station, still handles cash over the counter. The bank said the service was not sufficiently popular to warrant continuing. Cash will still be available through cash machines (ATMs).

Åse Dahl, bank manager at Oslo Central Station, said customers had adapted to cashless banks.

“We have only seen a marginal increase in transaction volumes in recent years. This is despite the fact that for almost a year Oslo Central has been the only branch of ours to offer this kind of service,” she said.

“Society is getting steadily more digital, and customers want to do as much as possible online or on mobiles,” Dahl told broadcaster NRK.

“The whole of society is going in this direction. The other banks will follow – it’s just a matter of time,” she said.

Access to cash in Scandinavia has gained international attention after The Local reported on a campaign against its disappearance, headed by former National Police chief Björn Eriksson.

Eriksson, now head of a lobbying group for the Swedish security industry, argues that cash is a crucial part of society’s infrastructure. He alleges that the decision to abandon cash is being made by banks simply to increase profits:

“Something is being privatized without people knowing what the implications of that privatization are.”

People in rural areas and pensioners could be disadvantaged, he said, while security risks were being outsourced from banks to poorly-equipped small businesses.

“People end up sitting with cash that nobody wants to take. When banks don’t take cash, it ends up being handled by teenage girls in small country shops, where security isn’t as high as in banks.”

Eriksson also argues that the mobile card readers that often replace cash rely on good mobile reception, which is often patchy in rural parts of Scandinavia.

But Per Skorge, general secretary of the Norwegian Farmers’ Union, said he was generally positive towards the move towards electronic money:

“Mobile reception is an issue, but then the discussion should be about how to get better mobile reception.”

Customers who buy from farm shops generally want to pay by card, he said. “People don’t usually have cash, so it’s better if people can pay by electronic means,” he argued, adding that electronic payments helped to prevent tax dodging.

For members

MONEY

Exchange rate: What are your options if you live in Norway but have income in pound sterling?

The value of the British pound has fallen steeply against the dollar in recent days but also against the Euro – and the krone. So what should you do if you live in Norway but have income – such as a pension, rental income or a salary – in pound sterling?

Exchange rate: What are your options if you live in Norway but have income in pound sterling?

Exchange rates might sound like a spectacularly dull topic, but if you live in Norway (where, naturally, your day-to-day living expenses are paid in kroner) but have income from the UK in pounds, then the movement of the international currency markets will have a major impact on the money that ends up in your pocket.

This is not an uncommon situation – Norway-based Brits may work remotely as freelancers from British companies and be paid for invoices in pounds, while retired Brits might be receiving a British pension.

Others might have income from rental properties or investments.

So a big loss in the value of the pound against the euro – and by extension, the krone – can have a major impact on Brits in Norway.

The most recent fall in the value of the pound was sparked by the UK government’s new mini budget and has already seen a relative recovery. 

But while this one-time fall is spectacular, it’s also part of a longer-term trend in the fall of the value of the pound, especially since Brexit, that has seen people such as foreign-based pensioners lose a big chunk of their income.

So if you have income in pounds, what are your options?

Income in kroner – obviously, this isn’t an option for everyone, especially pensioners, but the best way to protect against currency exchange shocks is to make sure that you’re paid in the same currency that you spend in.

While the krone is traditionally weak against the pound, it is known as a safe and stable currency as Norway has no net debt, and the Norwegian krone isn’t pegged to another currency. 

Alternatively, income in euros: the advantage of the euro is that for those being paid from abroad, billing in euros means you could work in any EU country – including the anglophone ones like Ireland – and get your salary in euros.

Depending on your employer, it might also be possible for you to ask to bill in euros. 

Work in Norway – if you’re currently not working or want to switch to local currency income, then an obvious option is to take up some work in Norway.

Depending on your work and residency status, as well as the field you work, the practicality of this option ranges wildly from one person to the next.

READ ALSO: What is Norway’s job market like for foreigners at the moment?

Exchange rate – if your income can only be paid in pounds, it’s crucial to ensure that you get the best exchange rate possible and that you don’t waste money on international transfer fees.

The best options here are online banks or money transfer services, which compete on the rates that they offer, so usually have the most advantageous rate.

Some online banks also have the option to set up accounts in both pounds and kroner, so that you can receive money in pounds and spend it in kroner without having to make bank transfers, which can attract fees.

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