Ireland set to ditch one and two cent coins

Ireland set to ditch one and two cent coins

The removal of the coins follows a trial in 2013, but the denominations will remain legal tender

Patrick Collinson

Monday 19 October 201511.51 BST

http://www.theguardian.com/money/2015/oct/19/ireland-ditch-1-cent-2-cent-coins

Small copper change is on its way out in much of Europe, with Ireland the latest country to drop one and two cent coins from circulation.

From the end of October, retailers will round up or down to the nearest five cent as smaller coins are phased out.

The country joins six other EU nations which have already adopted a rounding policy, including Belgium, Denmark, the Netherlands and Sweden.

The Central Bank of Ireland said one-cent coins, worth about 0.7p, cost more to mint than their equivalent face value: a one cent coin costs 1.65 cents to produce, while the two cent coin costs 1.94 cents. The phasing out of the one and two cent coins means that the five cent coin – worth 3.7p – will be Ireland’s smallest unit of exchange.

Shops and supermarkets will still be able to price goods at 99 cents or €1.99, for example, but will only give cash change to the nearest five cents. The rounding will only apply to cash transactions, with electronic payments still accepted in one cent increments.

Charities are worried that the withdrawal of small coins will hit donations. Ireland’s Change for Charity group campaigned to keep small coins. It said that scrapping the coins could lead to the charity sector missing out on millions in revenue.

But Ronnie O’Toole of the Central Bank of Ireland said evidence showed that consumers and retailers would welcome the move.

“As a country we are good at making changes like this,” he said. “We migrated to the euro ahead of most other countries, and the indications so far are that consumers and retailers alike will embrace rounding.”

The bank said that one cent and two cent coins will remain legal tender, so stashes in piggy banks and old whisky bottles can still be exchanged at banks. It will not be compulsory for retailers to round up or down, but shops will be encouraged to participate, with stickers on tills and posters in shops informing customers of the change.

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