Press Release

Now that the Treasury has stopped making 1p and 2p coins, should we scrap them completely? – City A.M

Alex Lambert 12 août 2019

Now that the Treasury has stopped making 1p and 2p coins, should we scrap them completely?
Finn McRedmond, a staff writer at Reaction, says YES.

The rising cost of living has eroded the value of pennies, while surveys suggest that now over half of them are left lying around unused.

And as cash use falls, overtaken by card payments for the first time in 2017, this redundancy will only increase.

Because of this decline in value, the two million people in the UK who still regularly need to use cash – the elderly, people who live in rural areas, and the vulnerable – can no longer rely on coins of such a small denomination.

Pennies often end up in the hands of charities. This seems like a good thing, until you remember that these charities have to bear the cost and hassle of processing them. The availability of small change could also be dissuading consumers from donating in higher denominations.

The best case for keeping pennies is the nostalgia factor. But the best case for getting rid of them is that they’re expensive to make, harmful to the environment, remain mostly unused – and have been rendered pointless by the rising cost of living.

Khalid Talukder, chief operating officer at Elemental Financial, says NO.

The tidal wave of cryptocurrencies and mobile banking platforms is transforming how people exchange payments and conduct business. Yet the race for instant digital transactions should not be weaponised to justify abruptly ending the right to use traditional cash as people see fit.

One of the most disturbing aspects of the tech revolution is the assumption that everyone should embrace it, and those who fail to do so should be left to suffer the consequences. This approach has led to a sharp divide across the country, in terms of digital skills, broadband connectivity, career opportunities – and now potentially payment options too.

Let’s also not forget that many charities rely on 1p and 2p donations, which provide major funding to tackle homelessness and deprivation in our cities.

As the old saying goes: “look after the pennies and the pounds will look after themselves”.

Freedom to choose is a critical component of any democracy, whether that be the latest mobile banking app or using traditional coins.

Published in City A.M.