Nordic Nations Fortify Financial Systems with Offline Card Payments
Finland, Sweden, Norway, Denmark, and Estonia are advancing offline card payment systems to protect against internet disruptions and sabotage. This move follows geopolitical tensions and damage to critical infrastructure. With a heavy reliance on cards, these systems provide essential backups to ensure financial stability and security.
The Nordic countries of Finland, Sweden, Norway, Denmark, and Estonia are taking strategic steps to bolster their financial infrastructure against potential internet outages by rolling out offline card payment systems. This initiative addresses concerns over geopolitical tensions and recent unexplained damage to undersea infrastructure in the Baltic Sea region, believed to be aligned with accusations against Russia for acts of sabotage, despite Moscow's denial.
Tuomas Valimaki, a member of the Bank of Finland's board, emphasized the rising importance of offline systems due to changed geopolitical circumstances, including Russia's invasion of Ukraine. With only 10% of Finland's population using cash primarily, the country's dependency on card payments highlights vulnerabilities that necessitate offline solutions. Neighboring nations are similarly exploring these options.
The drive towards offline payments, supported by central banks in Sweden and Norway among others, involves using terminals that securely store transaction data offline until connectivity is restored. The effort to diversify payment systems also aims to reduce reliance on U.S. companies Visa and Mastercard. In parallel, Finland plans to introduce instant national payment and reserve bank account systems to enhance financial security.
(With inputs from agencies.)
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