The swedan cards and payments market is predicted to reach USD 135.94 billion in 2024 and USD 183.64 billion by 2029, growing at a CAGR of 6.2% during the forecast period.
The Sweden cards and payments market has grown tremendously over the years. This can be credited to the extensive use of cards for payment. As per a study, it is the most popular method in 2023 with over 11 million debit cards and more than 6.6 million credit cards. Moreover, the industry is also expanding due to the progressive adoption of payment services through mobile phones which incorporate payment cards into it. So, their growing use instead of physical cards accelerates the Swedish market. Moreover, the growing customer shift towards mobile and instant payments coupled with proactive government initiatives and policies contributes to the expansion of the market.
The majority of customers choose digital payment options whether purchasing in stores, paying bills or online. Also, the dominance of physical cards for a long is a major factor pushing forward the Swedish industry. However, nowadays a big section of consumers has begun incorporating their cards into mobile phones. According to a survey, it is found that Swish has surpassed the cash in terms of usage. With 84 per cent of respondents utilising debit cards, Swish is second with 82 per cent and cash at the third spot with 49 per cent.
The growing acceptance of mobile payment services is another key element boosting the Sweden cards and payments market. For instance, the second most frequently used payment option is the Swish mobile app. As per a study, on par with debit card eight out of ten customers choose Swish for payment in February 2024.
Further, the market also benefited from the rising retail and online shopping with the preferred payment method being debit card. In 2023, 63 per cent of customers settled their shopping bills via Debit cards.
The persistent rise in frauds and scams is a major hurdle for the Sweden Cards and payment market. Moreover, the country also faces the problem of cashless crimes since it is already starting to discard paper money as compared to all other European nations. Digital crime and online fraud have increased, with cyber attackers and thieves stealing 1.2 billion kronor in 2023, which has doubled from 2021. Law establishments believe the size of the criminal economy in Sweden could account for 2.5 percent of the nation’s GDP.
Problems with the accessibility of payment services, the exclusion of certain groups if they cannot comply or access the digital services and the lack of legalisation for ensuring cash can be utilised for payment are other key obstacles in front of market players. Apart from this, the long pending modernization of digital payment infrastructure, particularly since the termination of the P27 project by the banks, decreases the growth rate of the country’s market.
Sweden’s entry into the Eurosystem TARGET Instant Payment Settlement (TIPS) is believed to open potential opportunities for market players. In February 2024, it was reported that Sweden had joined the Eurosystem instant payments platform which will enable it to transfer or send money abroad along with person-to-person mobile payment solution Swish in TIPS utilising a single instructing party settlement model. Also, it is the non-euro nation to connect to TIPS with its local currency.
Additionally, the companies in the market have the opportunity to improve the effectiveness of instant payment since it is not as good as it should be compared to other countries in the Nordic regions.
The growing negative attitude towards the decline in cash usage is expected to present a greater challenge for the Sweden cards and payments market in the coming years. According to a 2024 survey, there has been a steady surge in the number of people having negative attitudes i.e. 44 per cent in 2023 against 36 per cent in 2022. This is because of a significant increase in the portion of participants who said they wouldn’t be able to adjust without cash in the present-day community as compared to 2022. Hence, such consumer sentiments and preferences might hinder the Sweden cards and payments market growth.
The debit cards segment completely dominates the Sweden cards and payments market and is expected to maintain its position in the coming years. This is due to the extensive use of debit cards for payment of in-store purchases. Most people have linked it to their mobile payment platforms which elevates the segment’s market share. The most essential factor compelling more customers to pay via mobile phone is that it is considered a simple and convenient method. Another reason for boosting the segment’s market size is the considerable growth in e-commerce. According to industry experts, the widely used payment method is physical debit cards and Swish online.
Whereas, the credit cards segment holds a relatively smaller portion of Sweden cards and payments market share.
The POS segment is likely to capture a higher portion of the Sweden cards and payments market during the estimation period. This can be credited to its quality of being contactless payments to provide a better return on investment and ease of access via smartphones. Sweden stands aside from other regional countries because of its unique payment preferences. Moreover, the fixed-line internet infrastructures in the industry are among the most appropriate for extensiveness, access to the internet, and e-commerce websites and platforms for all customer types and socio-demographics. In addition, higher consumption for tailor-made POS throughout a broad range of business use cases would propel the advancement of modern software products that would function as the foundation.
The ATM segment saw a significant drop in its market share in the past few years. As per a study, between 2020 and 2022 the number of ATMs throughout Sweden reduced by 12 per cent. The application of cash has been declining consistently for many years. However, in 2023 and recently in 2024, consumers have again started to acknowledge the importance of cash for the community, particularly in a crisis environment when online payment options may not work.
The payment cards segment is the leading category with the maximum portion of the Sweden cards and payments market share. Government policies and the growing inclination of customers are the factors boosting the segment’s market share. Moreover, a wide range of customers have been digitally settling their bills for many years. Apart from this, less than 5 percent stated the usage of other than digital products like cash and postal giro over the counter to pay bills in February 2024. This shows the significance of this segment across the region. Apart from this, the market also benefited from the reduction in cash usage in stores. On the other hand, the direct debit segment has grown moderately in the past few years
The Sweden cards and payments market is driving forward at a significant growth rate due to the dominance of debit cards and Swish mobile payment. For example, in 2023, the frequency of cash withdrawals from the ATM of Bankomat AB dropped as well as the value of cash in circulation by 10 per cent between 2018 and 2023. Further, the market also saw the rise of both debit cards and Swish because the latter payment method has not been completely added to the physical retail business. However, it was an early adopter of Swish, but currently, its Nordic and other nearby economies have grown further and provide more options to pay instantly. Also, the presence of legacy infrastructure and systems, along with the lack of time updates, have derailed its expansion trajectory.
Some of the Dominating players in the Market
Frequently Asked Questions
The most popular types of payment cards in Sweden are debit cards, followed by credit cards. Prepaid cards are also gaining traction, especially among younger consumers.
Technological advancements such as the integration of biometric authentication, blockchain technology, and the proliferation of mobile payment solutions like Swish are significantly influencing the payments market in Sweden.
Security measures include EMV chip technology, two-factor authentication (2FA), real-time fraud monitoring, and advanced encryption techniques to protect card transactions in Sweden.
Future trends in the Sweden cards and payments market include increased use of artificial intelligence and machine learning for fraud detection, greater adoption of digital wallets, and continued growth in contactless and mobile payments.
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