German city to do away with one and two-cent coins | News | DW | 01.02.2016
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German city to do away with one and two-cent coins

Officials in Kleve, a city on the banks of the Rhine, are planning to get rid of one and two-euro cent coins. They say circulating and producing the coins cost more than their actual value.

The "Klever City Netzwerk" (Kleve city network), the area's trade promotion union, asked over 800 traders in the city to do away with one and two-euro cent coins and simplify daily transactions beginning Monday.

Transactions would be rounded up or marked down in line with the "Swedish rounding-up model," in which for example, 10.21 euros or 10.22 euros would be marked down to 10.20 euros. Amounts of 10.23 or 10.24 euros would be increased and rounded up to 10.25 euros. The differences would even out eventually for consumers, officials said.

"We have had only positive reactions until now," Christof Dammers, head of local sports outlet Intersport Kleve told journalists. However, national supermarket chains and bigger chain stores in Kleve, like Aldi, Kaufhof and Douglas, are still sticking to exact payouts.

There were no estimates of how many traders participated on Monday, according to Klever City Netzwerk's Petra Hendricks. More than 50 businesses were supporting the proposed regulation right from the beginning and Hendricks said she expected more to join.

The current project is being tested for a couple of weeks. Hendricks said her network would check consumers and businesses' reactions to the rounding-up and then decide on further steps. "We are optimistic that it will be a success, she told the AFP news agency.

One and two-euro-cent coins are already a rare sight in everyday transactions in many European Union countries, including Denmark, Belgium, the Netherlands and Ireland, which adopted the rounding policy in October last year.

Kleve is the first city in Germany to take up such a project. Traders pay 30 to 50 euro cents for every roll of one or two-euro cent coins and around the same amount for depositing them in banks, making them expensive compared to their value.

Producing each one-euro-cent coin costs around 1.65 cents, far more than their actual worth. Dutch banks say they would save over 30 million euros every year if the coins went out of circulation.

mg/ng (AFP, dpa)

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