Norway's Biggest Bank Demands Cash Ban

Tyler Durden on 01/23/2016

The war on cash is escalating faster than many had imagined. Norway's biggest bank, DNB, has called for the country to stop using cash...

DNB's proposal suggests eliminating the use of cash would cut down on black market sales and crimes such as money laundering.

“Today, there is approximately 50 billion kroner in circulation and [the country’s central bank] Norges Bank can only account for 40 percent of its use. That means that 60 percent of money usage is outside of any control. We believe that is due to under-the-table money and laundering,” Trond Bentestuen, a DNB executive, told Norwegian website VG, the Local reported.

“There are so many dangers and disadvantages associated with cash, we have concluded that it should be phased out,” he added.

The country has already moved in this direction. Bentestuen estimated that only about 6 percent of Norwegians use cash on a daily basis, with the numbers higher among elderly people.

While DNB said its proposal will take time to complete, executives suggested the country start phasing out cash by discontinuing the 1,000 kroner note so it could focus on updating its banking system.

“Eighty-five percent of our customers say that they never or only very rarely go to the bank. Therefore we think it is a mistake to maintain a very old structure with local branch offices. It is better to follow the customers and improve the offers where the customers are: digital,” Bentestuen said.

In the meantime, DNB and Norway’s second largest bank, Nordea, have already stopped using cash in their branch offices. And the movement toward a goal of no cash has been going on for a while. The Norwegian Hospitality Association pushed to eliminate consumers’ right to pay cash at all stores and restaurants in 2013, The Local reported.

Other countries including Denmark and Sweden have made similar pushes as their populations also rely largely on electronic money.