You can let them stay under the couch cushions or throw them away but there’s just no need to pinch pennies anymore, as the smallest form of our currency is officially being phased out. Businesses and consumers are adapting to new change, so to speak, as the Canadian penny goes out of circulation.
As of February 4, the Canadian Mint stopped distributing pennies to businesses and financial institutions though the coins remain an accepted form of currency. Following last Monday’s phase-out, some cashiers emptied their registers of pennies and while exact money transactions can still be made through interact, cash payments can be rounded down to the nearest five-cent increment in favour of the customer as instructed by the Department of Finance.
Locally, large businesses in the townships are looking to make the transition gradual. When the government made the announcement public in 2012, management at St. Jacobs-based Home Hardware Stores Ltd. was supportive of the idea, says a company representative.“We support the government on this decision. The estimated savings for taxpayers from phasing out the penny is $11 million a year. The government’s rounding guidelines to round up or down for cash transactions when pennies are not available, are simple, transparent and fair for all parties,” said Lindsey Dietrich.
The Retail Council of Canada (RCC) last week released the findings of a survey of its members on the discontinuation of the penny and noted that “most of Canada’s retailers will be ready at the cash register to handle the phase out of the penny,” said Diane J. Brisebois, RCC president and CEO, in a release.
The RCC also says that most businesses will immediately start using the government’s rounding down model, but some businesses will continue to offer the penny to distribute exact change for as long as possible.
“While smaller businesses will do the rounding manually at first and then determine the appropriate course of action, both in relation to cost and customer service, it is not a practical approach for large retailers with thousands of employees,” Brisebois said.
The survey also appraised business’ readiness for the phase-out, as well as the potential cost to businesses due to the new rounding model.
As the pennies continue in circulation, Dietrich said Home Hardware stores are making this transition a gradual one for customers and cashiers.
“As long as pennies are available we will still have pennies in our cash registers and make exact change. Rounding up or down on cash transactions only becomes a factor when pennies are not available,” she explained.
Home Hardware has approximately 1,100 locations across Canada and as such, Dietrich said, it is up to the management of each location to decide how to handle cash transactions now. On a more general scale cashiers and other staff are being trained to handle the new policy on change and information on new government rounding guidelines have been made available on location for both staff and customers.
Steve Pond, Elmira BIA treasurer, said the group’s board has had no formal discussions on the subject.
“Not sure if members of the BIA have been involved in the discussion yet. I think it’s left up to each retailer; it’s not an overall township rule that we’re going to go with,” he said on Tuesday.
On a broader scale, businesses seem to have some time to review and adapt both their customer services and their technology for the total disappearance of the penny still to come. The RCC advocated that the penny be removed from circulation after the holidays to avoid more chaos in retail stores. Now, Dietrich said, big business is going through a period of adjustment.
“As the penny is gradually phased out of circulation this gives retailers more time to upgrade their point-of-sale systems as new versions of their software are launched which replicate the government’s penny rounding formula for cash transactions.”
In the meantime, many charities are using the transition time to encourage Canadians to get rid of their pennies by contributing them to a good cause.
Local bank branches are also offering a place for the pennies. Jennifer Lipp of TD Canada Trust said the Elmira branch will be colleting pennies until February 16, with proceeds to be donated to Woolwich Community Services. Royal Bank branches are collecting pennies for We Create Change penny bags associated with the Free the Children Foundation.