Payments rounded to nearest 5 cents from December: the end of 1 and 2 cents?
Friday, 15 November 2019
As of 1 December, retailers in Belgium will be obliged to round final totals to the nearest 5 cents in the case of cash payments, removing the need for 1 and 2 cent coins in daily transactions.
This change in law only applies to customers physically present in a store and not online shopping. What this means, for instance, is that a €4.99 transaction will automatically be €5 from 1 December.
So how will it work?
1 and 2 cents will be lowered to 0 cents
3 and 4 cents will be increased to 5 cents
6 and 7 cents will be lowered to 5 cents
8 and 9 cents will be increased to 10 cents
When paying by card, merchants are free to choose whether or not to round off payments, but must always inform the client.
So what can I do with my 1 and 2 cents?
Spend them: Despite this change, 1 and 2 cents will still remain a legal tender and will be accepted in shops, but limited to 50 coins per transaction.
Exchange them: Up to 5 kilos of coins can be exchanged free of charge at the National Bank in Brussels once a month.
Donate them: A lot of charities collect these coins and will continue to do so.
The reason for the rounding off is due to the supply of the coins. Despite approximately 1,600,000,000 (1.6 billion) being created, many are lost in circulation, reports VRT. This, in turn, leads to a need to produce more of the coins, which have a disproportionate production and logistical cost vs the value of the coin.
With compulsory rounding in effect, the National Bank will stop producing new coins, but those already in circulation will continue to be used.