For members


How safe is your money in a Swedish bank account?

What protections are there for your money if your bank goes bust? We had a look at the rules in Sweden.

How safe is your money in a Swedish bank account?
Photo: Henrik Montgomery/TT

US bank Silicon Valley Bank (SVB), a favourite bank to US tech firms and a well-known lender to start-ups, went bust on Friday morning after being hit by a classic bank run, as its clients sought to withdraw $42bn in a single day, a quarter of its deposits. Signature Bank, another American bank, was shut down on Sunday, after suffering a similar bank run on the back of the SVB collapse.

So, what would happen if your Swedish bank went bust? Should you rush to withdraw all your money if your bank looks to be in a precarious situation? Here’s the situation in Sweden.

Deposit guarantee

You may not have realised this when you opened your Swedish bank account, but most bank accounts in Sweden are covered by the government’s insättningsgaranti or deposit guarantee. Simply put, this guarantee means that, if your bank goes bust, the state will foot the bill and refund your money.

Most Swedish banks are signed up to the deposit guarantee, but you can check whether your bank is included on this list.

How much money does it cover?

In 2023, the deposit guarantee is 1,050,000 kronor per person per bank, so you will get all of your savings back if they are under this figure.

Note that this is per bank, so if you have accounts in multiple banks you have a separate deposit guarantee for each bank, meaning your deposit guarantee could cover millions of kronor if you spread it out over more than one bank.

If you have a joint account, you’ll each have an individual deposit guarantee, so a couple sharing an account would be able to get 2,100,000 kronor of savings back if their bank collapsed.

It’s also possible to apply for an extra supplementary amount of up to five million kronor for deposits “coupled to certain life events,” the Swedish National Debt Office explains on its website, if you’ve sold a property, received a damages payout from a court case, or an insurance payout, for example. This can’t be applied for until you’re in a situation where a payout is due. 

The guarantee applies to all private individuals (including children), as well as companies and other so-called “legal individuals”, such as the estates of deceased people, and it applies independently of any debts or loans you have with the bank in question.

Banks, municipalities, regions and government authorities are not covered by the guarantee.

How is it funded?

You may be wondering how the state is able to guarantee billions of kronor in the event that a Swedish bank fails. The answer is simple: the deposit guarantee is funded through fees charged to banks and other financial institutes which are then held in a fund.

The Financial Supervisory Authority has the power to decide when the guarantee should come into effect, and it also applies if the Swedish National Debt Office places a bank or other financial institute into administration.

Why does it exist?

The guarantee was originally introduced in the autumn of 1992, which was a turbulent time for the Swedish economy.

In order to stabilise the economy, the government introduced a general state bank guarantee, which in 1996 became a deposit guarantee covering 250,000 kronor per person per bank.

The idea behind the guarantee is to discourage people from withdrawing their money from a bank in crisis, thereby contributing to more stability in the financial system, as customers know they will get their savings back even if the bank eventually goes bust.

During the financial crisis of 2008, the guarantee was increased to 500,000 kronor. 

Since 2010, new EU rules have meant that the deposit guarantee should cover an amount equal to 100,000 euros, with the amount in local currency adjusted every fifth year to match this number.

The last adjustment was in 2021, where the guarantee was raised from 950,000 kronor to 1,050,000 kronor.

How many times have payouts been made?

Payouts have been made three times since the deposit guarantee was introduced in 1992. The first two payouts were in 2006, when two financial institutes, Custodia AB and Almänna Kapital went bust.

In Custodia AB’s case, 1,282 affected customers were reimbursed with a combined 134.2 million kronor, and 287 of Almänna Kapital AB’s customers received a combined total of 40.9 million kronor.

The third payout was in 2010, when Danish bank Capinordic went bust. As this was a Danish bank with a branch in Sweden, the Swedish deposit fund paid the difference between the Swedish guarantee, which was 500,000 kronor at that time, and the Danish guarantee, which was 50,000 euros. This meant that 825 customers received a combined payout of 10.6 million Swedish kronor.

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For members


Are Swedish supermarkets going to freeze food prices?

Sweden's Finance Minister has called for supermarkets to follow Lidl's lead after the grocery chain announced that it would lower and freeze prices on more than a hundred items.

Are Swedish supermarkets going to freeze food prices?

Prices will be cut on average by 11 percent, Lidl said.

“We have chosen a large number of popular products which we will give a lower standard price. These measures will cost money, but we are prepared to face that cost and do what it takes to support Swedish households in these times of financial challenges,” Lidl’s Sweden chief Jakob Josefsson said in a press statement.

Household grocery bills are soaring in Sweden, as The Local has previously reported. Prices of food and non-alcoholic beverages last month rose 21 percent year-on-year, the biggest increase since the 1950s, eclipsing even the high-inflation years of the 70s.

“I hope the large food giants will follow [Lidl’s] example,” Sweden’s finance minister, Elisabeth Svantesson, tweeted. 

“I think that these three food giants, which represent 90 percent of the market, can put some pressure on their suppliers,” Svantesson said. “Of course they can do that. Lidl is leading the way now.”

Svantesson did not rule out meeting with food producers and suppliers, but she sees focusing on the larger chains as a higher priority as they have the ability to put pressure on other actors further down the line.

In France, supermarket Carrefour decided to lower its prices earlier in March, and Kiwi in Norway has decided to do the same. In Sweden, however, Lidl is the only company to do so. Lidl’s market share in Sweden is between 5 and 6 percent.

Price freezes at other supermarkets unlikely

However, it looks like the other major supermarket companies – Coop, Axfood and Ica – don’t have plans to lower prices any time soon.

Sweden’s Coop supermarket said on Wednesday evening that they won’t be following Lidl’s lead.

“We adjust our prices when we get price adjustments from our suppliers,” Coop’s press secretary Marcus Björling told TT newswire. “We can see multiple items on their way down and expect therefore to see our suppliers dropping prices.”

“Our assessment is that we’re going to see lowered prices in some categories going forward.”

Axfood, which owns the Willys and Hemköp supermarkets, is not planning on any price freezes either, stating instead that they are planning more long-term.

“It’s a much more active price market at the moment, and that’s why we’re so clear that our long-term goal with Willys is to work on offering Sweden’s cheapest bag of groceries – across all products, not just a few individual items,” Axfood’s CEO Klas Balkow told TT on Wednesday night.

Ica’s CEO, Eric Lundberg, told TT that the supermarket were working hard to put pressure on suppliers to lower prices.

“[Lidl’s price drops] show how hard competition is at the moment, all actors are doing what they can to win customers. At Ica, we are working on price changes across the board, further offers for our Stammis customers and campaigns in individual stores.”

He added that “everyone at Ica” is working hard to put pressure on suppliers, through negotiations and through lessening price increases centrally and in stores.”

“We can see signs that price increases will start to slow down on multiple items throughout the spring,” Lundberg said.