What's happened
The UK Treasury has not ordered new 1p and 2p coins for 2024, raising concerns about their future. Despite public speculation about scrapping these coins due to declining cash use, the Treasury insists there are enough coins in circulation to meet demand.
What's behind the headline?
Impact on Cash Transactions
- The decline in cash usage is significant, with many businesses moving to cashless transactions.
- The absence of new coins may accelerate this trend, impacting those who rely on cash.
Public Sentiment
- Many people have nostalgic feelings towards 1p and 2p coins, viewing their potential removal as a loss of tradition.
- Conversely, some see the move towards a cashless society as a necessary evolution for convenience.
Economic Considerations
- The Treasury claims there are approximately 27 billion coins in circulation, suggesting no immediate need for new minting.
- However, the lack of new coins could lead to increased reliance on digital payments, affecting small businesses and vulnerable populations.
Future of Currency
- The last significant change to UK currency was the removal of the half-penny in 1984.
- With ongoing discussions about the future of cash, the fate of 1p and 2p coins remains uncertain, reflecting broader economic shifts.
What the papers say
According to The Independent, the Treasury has denied that the lack of new 1p and 2p coins indicates they will be scrapped, stating, 'We are confident there are enough coins in the system without the need to order more this year.' Meanwhile, The Guardian highlights public nostalgia for these coins, with many reminiscing about their childhood experiences involving pennies. The BBC notes that cash transactions have significantly declined, with a report indicating that cash payments fell to 6.4 billion in 2023, down 7% from the previous year. This decline raises questions about the viability of maintaining such small denominations in the future.
How we got here
The Treasury's decision not to mint new 1p and 2p coins this year has sparked discussions about the potential phasing out of these denominations. This follows a trend of declining cash usage in the UK, prompting questions about the future of small currency.
Go deeper
- What are the implications for small businesses?
- How does this affect cash-dependent populations?
- What alternatives are being considered for small transactions?
Common question
More on these topics
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A treasury is either
A government department related to finance and taxation, a finance ministry.
A place or location where treasure, such as currency or precious items are kept.
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The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom or Britain, is a sovereign country located off the northÂwestern coast of the European mainland.