That inevitable accumulation of almost worthless change could become a thing of the past this year as the Central Bank pushes to remove all 1- and 5-kopek coins from circulation.
There are about 7.3 billion 1-kopek and 5.8 billion 5-kopek coins currently in use across the country. One kopek is worth 0.03 cents.
“The majority of this money is not being used and shops are gradually stopping to accept it,” said First Deputy Central Bank Chairman Georgy Luntovsky, Interfax reported. “Moreover the production of these coins is loss-making.”
He declined to name the exact amount that the Central Bank loses in the manufacture of the small-denomination coinage but said it was “significant.”
The debate about the fate of the 1- and 5-kopek pieces is not new — inflation over the past decade has made the coins increasingly worthless. Many shoppers do not even bother to pick up their change when it only amounts to a few kopeks.
The Central Bank is currently in negotiations with the State Duma on the issue. Luntovsky said Friday that the legislative body was favorably inclined toward the process of abolishing the coins. “I hope that a decision of some sort will be made this year,” he said.
New 1- and 5-kopek coins are not currently being released by the Central Bank in a bid to reduce the quantity in circulation, but a new law would be required to eliminate them completely. The 10- and 50-kopek pieces, however, are still being minted.
In September 2011, the Duma’s financial markets committee expressed agreement with the Central Bank’s proposal to do away with 1-kopek coins. It will examine the proposed abolition of the 5-kopek piece later this year.
“This will have no impact on the economy of the country as a whole,” the Higher School of Economics’ Dmitry Miroshnichenko told Rossiiskaya Gazeta on Sunday. Experts have also said removing the low-denomination coins is unlikely to boost inflation.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.