Coin News

The Isle of Man have shared some big news about their copper coinage, and it’s causing quite a stir in the collecting community. They have confirmed that the phasing out of 1p and 2p coins will begin this year, meaning the days might be numbered for copper coins.

Why the change?

Following a consultation in 2023 by the Manx government about whether it should keep copper coins, residents responded with “no thanks”. With a population of only 84,000, many young people on the island said they don’t carry cash at all, and most rely entirely on cards or contactless payments. The pandemic also forced islanders to adapt to card payments.

Rising costs of minting new coins, especially coppers, means that making a new 1p coin now costs more than a 1p coin is worth. It’s not just the coppers either, as its estimated that a new 5p coin costs around 20p to make.

Taking these factors into consideration, the Isle of Man has encouraged businesses to introduce ‘cash rounding’ as the first phase.

What is cash rounding?

Cash rounding is the practice of rounding prices to the nearest five or zero, eliminating the need for 1p and 2p coins.

Cash rounding has been used in Sweden since the 1970s and was also adopted by Canada, New Zealand and the Republic of Ireland.

Copper coins will remain legal tender on the island, and won’t be withdrawn from circulation, but no more will be minted.

Let’s hear from the Isle of Man

After the cash rounding initiative was announced, there were concerns from the public about inflation. However, businesses were quick to claim that, based on research from other countries, this would not be a problem.

The Isle of Man’s treasury minister, Dr Alex Allinson MHK, said: “Most businesses here didn’t think it would cause significant inflation. But certainly the public perception is that it would do.”

He also stated that: “If the UK were to get rid of coppers, we would probably follow suit”.

No new coppers have been minted by the Isle of Man since 2016 due to decreased demand, and even the most recent decimal coin set, the 2023 Manx Wildlife Set, didn’t feature 1p or 2p denominations – so the phasing out process has been inevitable for a while.

What about the UK?

The number of cash payments in the UK has reduced significantly in the last 10 years, and especially so since the pandemic.

According to The Royal Mint, no new 2p coins were minted in 2022 and no new pennies were minted in either 2018 or 2019. This is an indication of decreasing demand for small change, even in the UK, so it’s not surprising that the Isle of Man, with a much smaller population, would be one of the first places to implement the phasing out of coppers.

Find out more about the future of 1p and 2p coins in the UK >>

A Treasury spokesperson confirmed that there are currently no plans to change the denominational mix of coins in the UK. So if the Isle of Man is waiting to follow our lead on getting rid of coppers, it’s unlikely that any definitive changes will happen anytime soon.

What do you think about copper coins? Do you still use the 1ps and 2ps in your change? Let us know in the comments!

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