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Issuing of one cent coin halted
While Central Bank stopped issuing one cent coins from July 1, the coin remains legal tender and can be used for cash payments until the Bank notifies the public otherwise.
The Bank (CBTT) stated this yesterday, as it issued guidelines for the public on the rounding off process which will apply to cash transactions following the future halting of use of the coin.
Rounding means the lesser or greater adjustment of a final cash payment to the nearest 5 or 10 cents.
The Bank intends to withdraw the one cent coin from circulation and in due course it will no longer be legal tender.
The bank expects to demonetise the coin by July 1, 2018.
As of July 1, 2017, the bank stopped issuing one cent coins. Over time there will be less in the system and price rounding on cash transactions will be required, CBTT added.
“When the one cent coin is demonetised, regulations will be introduced to mandate and enforce rules on rounding. Until such time, voluntary guidelines are intended to assist the public with the transition,” the Bank said.
Rounding will only apply to cash payments and to the total amount of the bill as follows:
• Where a consumer has one cent coins available and can tender the exact amount payable to the vendor in cash as the one cent coin remains legal tender;
• To payments made using non-cash methods such as cheques or electronic payments including, but not limited to debit, credit or prepaid cards;
• To individual prices of a good or service and, as such, prices on individual items need not to be changed;
• To duties, taxes or charges, which are to be calculated in their exact amount prior to rounding.
The Central Bank said a vendor might obtain consent to round off sums orally or by other means, such as appropriate signage at conspicuous locations.
However, participation in rounding during the transition period is voluntary for both vendors and consumers.
“The Central Bank encourages vendors and consumers to accept the rounding of the final amount of any cash payment or change owed in a consistent and transparent manner.
“A vendor/consumer who wishes to round must obtain the agreement of the consumer/vendor before proceeding with the transaction or before applying the rounding guidelines,” the bank said.
“There should be an indication to consumers of the vendor’s participation in rounding which could be done by in-store signage visible to the public.”
Where a vendor wishes to round but the consumer doesn’t agree, the bank advises that the vendor provide exact change to the consumer.
“If the vendor insists on rounding, a consumer may tender the exact cash amount payable, pay for the good or service using a non-cash method, or no longer purchase the good or service from that vendor.”
Rounding UP to the Nearest Multiple of 5 Cents Rounding DOWN to the Nearest Multiple of 5 Cents
A payment of $1.03 shall be rounded to $1.05
A payment of $1.04 shall be rounded to $1.05
A payment of $1.08 shall be rounded to $1.10
A payment of $1.09 shall be rounded to $1.10
A payment of $1.01 shall be rounded to $1.00
A payment of $1.02 shall be rounded to $1.00
A payment of $1.06 shall be rounded to $1.05
A payment of $1.07 shall be rounded to $1.05