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Friday, June 21, 2024

Cash is going out of date, and use

It’s become increasingly difficult to pay with cash in Norway, with the Corona crisis helping tax authorities to discourage its use. Now more of it is also being phased out by the central bank, which otherwise insists that cash remains legal tender and should be accepted by all merchants.

This old 1,000-kroner note, worth around USD 111 at current exchange rates, will be taken out of circulation from November 14.  ILLUSTRATION: Norges Bank

Norges Bank has reminded Norwegians that within four weeks, the 1,000-kroner notes that have been in use since June 2001 will be taken out of circulation. It’s perhaps ironic that the notes (currently worth around USD 111 each) featuring famed Norwegian artist Edvard Munch was timed to disappear just as the new Munch Museum in Oslo was due to open.

The museum opening has been postponed because of delayed delivery of special security doors and the Corona crisis. The latter has now also created challenges for those needing to exchange the old cash that’s being taken out of circulation. Anyone still holding the soon-to-be-withdrawn 1,000-kroner notes are advised to spend them or deposit them into bank accounts by November 14, when they’ll no longer be valid.

“There’s nearly 6 million of the 1,000-kroner notes still in circulation,” Leif Veggum of Norges Bank stated in a press release, worth a dizzying NOK 6 billion, so there may be a flood of them on the market over the next few weeks.

Here’s Norway’s new 1,000-kroner note, introduced last fall as the last in a new series of currency launched by the central bank. PHOTO: Norges Bank

The Edvard Munch 1,000-kroner notes are the last of the central bank’s old currency series to be withdrawn. Those still holding them after November 14, along with other denominations of notes in the old series, will face delays getting them exchanged because of Corona infection concerns that prompted Norges Bank to “temporarily” close its offices that exchanged old notes for new. The central bank’s main office in Oslo along with “depots” in Bergen, Stavanger, Trondheim and Tromsø have already been closed for months, forcing those wanting to swap old money for new to follow other procedures (external link to Norges Bank’s own website) or wait for the central bank’s offices to reopen.

The “old” money has been replaced by a colourful new series of cash notes that highlight Norway’s maritime heritage. It symbolizes Norges Bank’s commitment to cash, even at a time when tax authorities want transactions registered through credit- or debit cards and other electronic means to boost transparency and hinder the black market.

The central bank remains committed to printing currency and being able to use it, even though merchants and tax authorities are not. PHOTO: Norges Bank

Since the Corona crisis began, many merchants have actually refused to accept cash as a virus infection control measure. They’ve claimed that handling cash can put those at the cash register at risk. Most grocery stores have check-out lines that only accept payment by card. The state-controlled wine and liquor retailer Vinmonopolet also discourages use of cash, while some shops and cafés like Kaffebrenneriet in Oslo won’t take cash at all.

That’s actually illegal, according to Norges Bank, which calls cash both safe to use and an enforced method of payment in Norway. The bank itself can’t prosecute merchants who refuse cash, urging consumers who want to pay with cash to contact other authorities such as the state consumer council (Forbrukerrådet).

“As for infection risk, Folkehelseinstituttet (the state public health institute) has concluded that there are no indications that use of cash as a means of payment represents a risk for spreading Covid-19,” Veggum stated. He added that a consumer “always has a right to settle payments” in cash for amounts up to NOK 40,000, in accordance with laws against money laundering. Berglund



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