Research revealed yesterday that up to one in five people suffers from “penny rage” – we chuck out 1p and 2p coins because we get fed up carrying them.[From Express.co.uk – Home of the Daily and Sunday Express | UK News :: We really do throw away cash]
I'd never heard of "penny rage" before, and I'm not sure that "rage" is the right description, but I too find low-value coins nothing more than shrapnel. When was the last time you bought anything for a penny? Every day I take them out of my pocket, every night I come home with more (although my efforts to have cashless days have gone much better recently since Arriva introduced its iPhone application and mobile bus tickets in Woking — last week I didn't have to find cash for the bus even once!).
The 18bn British copper coins in circulation weigh the same as 213 fully loaded jumbo jets. Many of them – along with a further 6.5bn pennies the Royal Mint believes are “missing” – line the bottom of sock drawers and fill fridge-top jars. This mass of idle shrapnel indicates that many Britons stopped bothering with the stuff long ago. So it is surprising that the UK – along with G8 peers US and Japan – still continues to circulate their most basic unit of coinage, while countries such as Australia, the Netherlands, Brazil and Israel have all phased out their low-value change in the past 20 years.[From FT.com / Lex / Financial services & property – Small change]
Yet in the UK, instead of doing something sensible such as melting down "copper" coins (they are not, of course, made out of copper at all) to make something more useful in these times of austerity, we are focusing on the higher-value coins.
Random sampling tests carried out by the Mint last May found that 2.58 per cent of £1 coins were counterfeit-compared with 2.06 per cent seven months earlier in October 2007 – or one in 50. This had doubled since 2002, when one in 100 £1 coins was counterfeit.[From £1 fakers are quids in: Counterfeit coins surge to a record high | Mail Online]
Perhaps it's time to call in the £1 coins and remint a more counterfeit-resistant alternative? No: we're going to remint the small "silver".
Britain's 5p and 10p coins are to be substantially changed next year, causing potential chaos for the millions of people using vending machines and parking meters.[From New steel 5p and 10p coins a 'disaster' – Telegraph]
Actually, this could be a blessing in disguise. Hopefully, some of the people who are complaining that enormous amounts of their money is going to be wasted (people who sell things through kiosks and the like) are going to take the opportunity to simply give up on coins completely: why replace the coin unit in a drinks machine with another coin unit when you could replace it with a contactless card reader and at the same time put the vending machine online through a built-in GPRS unit? (Answer in Europe: because under the current EMV scheme, you must install a contact reader and a PIN pad as well.) A good place to start would be with the vending machines in the London Underground, where every single person has a contactless-only card already.
Of course, on current trends, there might be another doom. As coins become worthless as money, they may not necessarily we worthless as metal. The Bangko Sentral ng Pilipinas (BSP) has noticed that much of the 16 billion coins it put into circulation since 1997 have disappeared from circulation. Some are so low value they've just been thrown away and the rest have been exported to be melted down for their component metal. Could this happen in the UK? At the moment, the metal in a 1p coin is still worth less than 1p (they are copper-plated steel), but as the value of Sterling continues to fall because of quantitative easing, and the value of metal rises because of (let's say) Asian demand, it might change.
Are coins, then, doomed? Well some are, but not all of them. And that's because of simple economics.
Most countries in the G8 have ceased to circulate a note in their base unit of currency… Because a coin can last four decades while a note lasts only a few years, replacing the dollar bill with the coin could save the US $500m to $700m per year in printing and paper costs.[From BBC News – Why the US keeps minting coins people hate and won't use]
The US remains the outlier here as they continue to issue dollar bills (and pennies that cost 1.7 cents to make). If you think that the US coin/note boundary is fine as it is, try a though experiment based on a recent incident in Italy.
A truck carrying some €2 million (£1.6 million) in coins overturned in Italy, unloading its contents on to the highway.[From Motorists snatch £8,000 after lorry load of coins crashes – Telegraph]
If you saw a crashed lorry and coins all over the road, would you stop and pick a few up? In the US, probably not: a big bag of quarters is a pain not a pleasure. But in Italy? Maybe: you could grab quite a few €2 coins before the police arrive.
These opinions are my own (I think) and presented solely in my capacity as an interested member of the general public [posted with ecto]