The National Bank of Ukraine has finally recognized the fact that the Ukrainian kopiykas is worthless, and decided to get rid of it. Besides, 2, 5 and widely used 25 kopiyka coins will be gone as well because you can’t buy anything for them and most often you don’t get a proper small change in convenience stores.
In order not to raise anxiety among the already anxious Ukrainians and not to make them rush and break their piggy banks, the central bank vows not to withdraw the depreciated coins from circulation mandatorily but simply stop their production. When one lacks coins for cash settlement, the regulator proposes to round the purchase amount, guided by the usual mathematical rule, when 0-4 is rounded to zero, and 5-9 - to 10.
World experience shows that the developed countries of the Eurozone are also concerned with the issue of the turnover of small coins
The National Bank submitted its draft resolution for public discussion, expecting its finalization within a month. On the one hand, the NBU arguments sound quite logical: the costs of production and transportation of small coins are several times greater than their real value, while the introduction of the proposed initiative will allow the regulator to save over UAH 90 million a year.
World experience shows that the developed countries of the Eurozone are also concerned with the issue of the turnover of small coins. Finland, the Netherlands, Belgium, and Ireland have also resorted to rounding off the purchase amount in order to provide for a painless elimination of coins worth 1 and 2 Eurocents, From January 1, 2018, Italy will do the same. The central bank of Germany is also considering such step.
On the other hand, it’s a shame to see this happening to kopiykas. After all, as they say, “every kopiyka counts”. Besides, the rounding rules proposed by the National Bank could cause perception difficulties among market players and pensioners. I already see the face of my neighbor of respectable age, who recently complained out loud about "a mess in the country," because her "heart pills already cost UAH 3". I wonder what she’ll say to a supermarket cashier who will offer her nothing instead of 4 kopiykas...
Let's admit, grannies will grumble but they’ll eventually get over it. After all, they’ve been through some tougher times. But will this step by the regulator provoke another price hike? The NBU rushed to assure the public that there will be no acceleration of inflation, since the whole sum of purchase is offered for rounding, not the prices of individual goods. However, some sellers could certainly round up the prices of goods to prevent queues and complications with rounding-off at cash registers.
Let's appreciate the role of those small coins in taking care of the hryvnia for so long. Now this honorable mission will be given to coins worth 10 and 50 kopiykas
So, 21 years after its birth, after the monetary reform in September 1996, the Ukrainian hryvnia will say goodbye to four small coins. We should admit that this is not the worst thing that has ever happened to our national currency throughiut its history. After all, it depreciated against the dollar almost 15-fold - from UAH 1.8 to the dollar in 1996 to the current UAH 26.5.
So we will survive this trouble for sure. Let's appreciate the role of those small coins in taking care of the hryvnia for so long. Now this honorable mission will be given to coins worth 10 and 50 kopiykas. And there may appear coins worth 2, 5, and 10 hryvnias. And maybe in some 50 years or so, cash money will become useless, giving way to some new technology.
And we have to develop in this direction, too. For example, in the Scandinavian countries, the share of non-cash payments has already exceeded 90%. Meanwhile, Ukrainians still continue to give preference to cash settlements. In the third quarter of this year, the volume of cash withdrawal operations from payment cards totaled more than UAH 333 billion, which is more than 60% of the total volume of card transactions.