Does That Homeless Guy Take Credit Cards?

He does in Sweden. Welcome to the cashless society
The buyer sends a text message with the seller’s unique ID. The seller receives a receipt and can later collect the money Photograph by Melker Dahlstrand/Image Bank Sweden

Stockholm’s homeless magazine vendors no longer need to ask if you can spare any kronor. They take credit cards. In the most cashless society on the planet, a few of the sellers of Situation Stockholm, a culture magazine hawked by the homeless, were equipped in September with portable card readers to accept payments from fellow Swedes. The move marks a world first, according to their employer.

“More and more of our sellers come in and say that people don’t have cash—they have told us this for a long time,” says Pia Stolt, the magazine’s chief executive officer. “This becomes frustrating, but now they feel they offer an opportunity to buy the paper.”

In Sweden, which printed Europe’s first bank notes in 1661, bills and coins represented just 2.7 percent of the economy in 2012, compared with an average 9.8 percent in the euro area and 7.2 percent in the U.S., according to the Bank for International Settlements. Many Swedes think 2.7 percent is too high. “We could and should be the first cashless society in the world,” Björn Ulvaeus, a former member of Abba, says on the website of a Stockholm museum dedicated to the Swedish band. Situation Stockholm, which costs 50 kronor ($8) and whose cover stories feature Swedish celebrities such as pop star Robyn and actress Noomi Rapace, already can be bought via a text-message service.

By supplying its street vendors with card readers from Swedish mobile-payments company iZettle, the magazine is seeking to accelerate sales. “This will make it easier to sell the magazine, and I also think this changes a little the image that people have of our sellers,” who keep 50 percent of the money they take in from peddling the magazine, Stolt says.

Five of Situation Stockholm’s 350 vendors are using the equipment, and the publication decided to introduce the devices on a broader scale after its initial trial increased sales. “Before, everyone said they don’t have cash or that they cannot pay with their mobile phones because it was a corporate phone. But now they can’t get away,” magazine vendor Stefan Wikberg says as he stands outside the subway entrance at Stockholm’s central station. “I take cards, SMS payments, cash, and they can also pay in dollars and euros.”

Cards are also the only form of payment at Abba the Museum, where Ulvaeus is an investor. Ulvaeus—whose hits with Abba included the song Money, Money, Money—lived for a year without coins and notes and says the only inconvenience he found “was that you need a coin to borrow a trolley at the supermarket.” SEB, Swedbank, and Nordea Bank, three of Sweden’s four largest banks, have stopped offering cash-handling services by tellers in 65 percent to 75 percent of their local branches. Over the past 12 months, the number of ATM transactions decreased by 11 percent, according to Swedbank.

Situation Stockholm was initially concerned that Swedes would hesitate to use a credit card on the street. “This was one of the things we were wondering about—how safe people would feel with iZettle and this card reader—but they do,” CEO Stolt says. “Now we will reach people who actually never carry cash.”

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