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Sweden’s Central Bank Riksbank to Team Up with Accenture and Develop e-Krona

Sweden’s Central Bank Riksbank to Team Up with Accenture and Develop e-Krona

  • The Riksbank is investigating whether Swedish kronor should be made available in electronic form.
  • Accenture would build up the consumer-facing features of the e-krona.
  • The initial contract will last for one year, but they were willing to conduct at least seven years of testing.

The use of banknotes and coins in society is growing. At the same time, there is rapid progress in technological advances in digital cash and payment methods. Therefore, the Riksbank is investigating whether Swedish kronor, should be made available in electronic form. Albeit, no decisions on issuing an e-krona have been made as of now.

The Riksbank has the task of fostering a safe and efficient payment system, a job that could be more complicated if many households and businesses no longer use money in the future as a means of payment. Therefore, the Riksbank needs to consider the role it should play in a growing digital world. In the spring of 2017, Riksbank launched a project to check the scope to issue a digital central bank currency (CBDC), a so-called “e-krona.”

Accenture would build up the consumer-facing features of the e-krona – such as how a customer can pay on different mobile channels – and run them in a “simulated shops” test environment. The initial contract will last for one year, but they are willing to conduct seven years of testing.

The agreement, which the central bank plans to sign later this year, is set to move the long-awaited e-krona of the Scandinavian nation one step closer to reality, regardless of the limitations.

Such a creation could draw on the increasing aversion to physical cash from Sweden. Swedes have flocked to cashless payment alternatives so readily that Deputy Governor Timothy Lane of the Bank of Canada has confirmed that physical kronas are out of favour.

Deputy Governor Cecilia Skingsley of the bank said in 2016 that Riksbank was being pressurized to move away from coins and bills that were primarily baulked at by the public.

It then started to study in depth an e-krona. Two reports discussed everything from the legal ramifications of digital currency to its effects on bank lending rates.

These reports revealed Riksbank’s lack of interest to base any such digital currency on a blockchain or distributed ledger technology (DLT), which they described as an “inefficient technology.” Still, its 2018 report nevertheless stated that “an e-krona should be able to interact with DLT solutions.”

In its request for a proposal in June 2019, Riksbank classified the procurement process, saying in a press release that the information was crucial to national security.

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About Prerna Sengupta

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Prerna Sengupta is a writer for Thecoinrepublic. She is a law student at NALSAR University of Law, Hyderabad. She is interested in Tech Law and is especially keen on cryptocurrency, blockchain, and Bitcoin. She hopes to pursue this field in the future as a lawyer.

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