Germany's ongoing discussion about eliminating the 1 and 2-cent euro coins has gained significant traction, particularly supported by the National Cash Forum, an organization aligned with the Bundesbank. This move is driven by the realization that many of these small coins are kept at home rather than spent, leading to a surplus of coins that remain out of circulation. Banks highlight problems resulting from these low-denomination coins, including the high costs of minting and distributing them. Advocates for change point towards benefits like cost savings, better efficiency, and a positive environmental impact.
The push to remove 1 and 2-cent euro coins in Germany stems from their inefficiency, as they are often hoarded and not returned to circulation.
Banks have raised concerns over low-denomination coins, reporting that a significant number, around 40.1 billion 1-cent and 31.4 billion 2-cent coins, are essentially non-effective.
The National Cash Forum advocates for a legal rounding rule that could ensure efficiency and cost savings while maintaining cash as a universal means of payment.
Germany’s movement to discard small change reflects both economic sensibilities and broader trends toward efficiency and environmental considerations in currency management.
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