Asia Minute: South Korea Phasing Out Coins

Apr 16, 2016

Credit Wikipedia Commons

There’s a financial debate underway in many countries around the world. It’s not about interest rates or taxes, but about coins—and whether it’s time to drop them. HPR’s Bill Dorman has more in today’s Asia Minute.

South Korea plans to phase out coins entirely by the year 2020.  The Bank of Korea has already cut back on the number of coins it mints—reducing them by nearly a third over the past ten years.

But without coins, how would you get change at the store?  The plan is that consumers who pay cash at retailers would receive their change in credit—either on a credit card or a mobile bank account or maybe even a transportation card.

Elsewhere in Asia, some countries already use only paper money—including Cambodia, Laos, Myanmar and Vietnam.  Thailand is trying to convince them to go the other way—pointing out that coins are much more durable than currency notes.

Thailand would also like to make the coins.  Several countries have stopped making coins of small denominations.  New Zealand dropped its one and two cent coins back in 1990---and tossed out its five-cent coin almost ten years ago.  Canada scrapped its penny several years ago….and President Obama has said he’d be willing to kill the US penny—which now costs more to produce than it’s worth.

The future of coins in the Asia Pacific and beyond will be a topic in Thailand in a couple of weeks…when members gather from 47 countries for an international conference of Mint Directors.