Canadians will soon be saying goodbye to pennies.
And very soon the nickel will also become obsolete.
The Royal Canadian Mint will start collecting one-cent coins next month for melting and recycling of the metal content.
Most Canadians are happy about this.
They regarded this coin and a nuisance.
I was not a big fan of the penny.
I am glad it is going out of circulation.
We no longer see items priced at $1.99. Instead, the price will either read $2 or $1.95.
Businesses and service providers will be required to round off cash transactions to the nearest nickel.
It was during a budget a couple of years ago that Finance Minister Jim Flaherty announced the expected demise of the penny.
Many Canadians are already suggested and asking for the government to put the nickel to pasture as well.
No one knows then this will happen.
My guess is it will be several years before we say goodbye to the nickel.
Even after February, the penny will remain legal tender indefinitely.
It will disappear but the change will be gradual.
“We see less and less people now…digging in their wallets for nickels,” jean Pierre Aubrey, a former Bank of Canada economist, was quoted as saying.
Look into your own wallet or purse and see how many nickels you carry.
Many people feel that the penny should have been retired many years ago.
Canadians were fond of hoarding the pennies.
When this happened, the Royal Canadian Mint was in a real dilemma.
It had no other choice but to keep on churning out billions more to keep retailers stocked.
This was costing the federal government up to $11 million annually.
The last pennies minted on May 4 last year in Winnipeg were costing about 1.6 cents each to manufacture.
This didn’t make any sense.
There are also reports retailers, banks and consumers have absorbed about $140 million in handling costs each year, creating an unnecessary drag on the economy.
So far the Ottawa has kept mum on when the nickel will be laid to rest.
New Zealand successfully eliminated its five cent piece in 2006 after dumping its one and two cent coins.
Since 2009, Australia has also been considering whether to follow suit by getting rid of its five cent coin.
The Royal Canadian Mint has been producing pennies for the past 150 years.
Canadians will no longer have to accept and pennies that weighed down their pockets while adding little to their purchasing power.
One report has suggested it will cost about $38 million to redeem some six billion pennies over the years.
Recycling the zinc and copper from melted down pennies will bring in about $43 million.