America will no longer make one cent coin
America was incurring huge losses in making each paisa (cent) which we consider small. Because of this, America has now decided to stop making 1 cent (penny) coins. According to the latest report of the US Mint, it was costing about $0.0396 (3.96 cents) to make a 1 cent coin, whereas its price was only 1 cent.
That is, the coin was costing almost four times its actual price. To avoid this huge loss America has ordered to stop the production of new penniesThe last coin of this 232 year old penny was pressed on Wednesday, According to the report, the US suffered a loss of $85,3 million last year due to pennies alone, It is estimated that by taking this step America will be able to save $56 million annually,
Not just cents, nickel was also giving a strong blow
It is not that Penny was the only loser. In America, 5 cent coins, which are called ‘Nickel’, were costing more than double their cost to make. It used to take $0.138 (13.8 cents) to make a nickel, whereas it is worth only 5 cents. However, the good news is that larger coins like ‘Dime’ (10 cents) and ‘Quarter’ (25 cents) cost less than their face value, so these are not a reason for loss.
Despite pennies ceasing production, approximately 300 billion pennies are still in circulation in the United States, and will remain legal tender. However, experts believe that retailers may now have to round off prices to the nearest 5 cents (nickel).
How much does it cost to make a 1 rupee coin?
This situation is not only in America. Even in India, the cost of coins is often higher than their face value. In 2018, the Reserve Bank of India (RBI) had given shocking information in response to an RTI. According to that report, the Government of India had to spend ₹1.11 in making one ₹1 coin, which means a direct loss of 11 paise on every ₹1 coin. Not only the ₹1 coin, the story of other coins is also no less interesting.
- ₹2 coin: Its cost is ₹1.28 (Government has benefit in this)
- ₹5 coin: Its cost is ₹3.69 (Government has benefit in this)
- ₹10 coin: It costs ₹5.54 to make. (Government has benefit in this)
That is, in the Indian currency system, the ₹ 1 coin itself was mainly causing losses, while making ₹ 2, ₹ 5 and ₹ 10 coins was a profitable deal for the government. All these coins are made in government mints located in Mumbai, Hyderabad and other cities. The ₹1 coin is made of stainless steel, which ensures its strength and long life.
Printing notes is a profitable deal
Printing notes is much more beneficial for the government than printing coins. According to RBI data, the cost of printing notes is much less than their face value.
- ₹500 note: It costs about ₹2.29 to print one note.
- ₹200 note: Its printing costs approximately ₹2.37.
- ₹100 note: Its cost is approximately ₹1.77