In Sweden, the great swishing sound has got much louder
Five years ago, CCS Insight highlighted Sweden’s digital payment service Swish as a model of a successful mobile payment service, calling it one of the top new findings in 2015 (see Swedish Swish). At the time, Swish had 3.6 million users, meaning that about one third of the Swedish population already had Swish accounts. That number has since more than doubled, with 7.5 million registered private and 215,000 business accounts. The service is now embedded in the country’s economy as well as vocabulary. To “Swish” is now an everyday verb for Swedes, along with to Google and to Skype.
Giving credit where it’s due, the service was formed as a result of proactive thinking on the part of about a dozen of Sweden’s established banks, all realizing that any company in any industry could be disrupted given the ease of reaching scale in the digital world. This sort of anticipatory thinking should be second nature to all companies spanning all industries. Swish didn’t try to change behavioural trends, but went along with the flow, building its service on the ubiquity of smartphones and mobile subscriptions. Swish joined the app economy with an easy-to-use, free service, allowing banks to keep their customers based on customers’ entrenched habits.
Swish isn’t alone in the Nordic countries as a 21st century payment phenomenon, as cash becomes an anachronism at the top of the world.
In Norway, a mobile payment service called Vipps enjoys a success similar to Swish. Almost every Norwegian smartphone holder, meaning almost every Norwegian, is a Vipps user. Nearly half the country’s population relies on the service on a daily basis.
And in Denmark, a service called MobilePay has also become part of everyday life for Danes. It’s now so common that businesses and charities accept payment through the digital payment service. Banks cooperated to offer a competitive modern digital service, allowing them to fend off usurpers.
The success of these services can be pinned on the realization that banks weren’t looking at traditional rivals, but rather gigantic technology companies striving for expansion as well as start-ups entering with completely fresh business models.
Banks in Scandinavian countries recognized early on that companies such as Apple, Facebook, Google and Samsung had earned extremely loyal users, and this loyalty could be exploited to establish deeper financial relationships. Financial institutions in the Nordic region anticipated what was about to happen and were able to weave themselves into the digital financial fabric of society. An ounce of proactivity would be worth a pound of reaction.
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