PLANS to scrap 1p and 2p coins have been axed with the Chancellor today confirming that copper pennies will stay in circulation.
Philip Hammond had branded the coins as “obsolete” in his 2018 Spring Statement where he unveiled shock proposals to ditch them.
Alamy Philip Hammond has confirmed that 1p and 2p coins are here to stay – for now
He also questioned the future of the £50 note amid claims it is used almost exclusively by criminals.
But he has today U-turned on the policy, saying there will be no changes to current coins and notes, with all denominations – from the penny to the £50 note – staying in circulation.
Around 2.2million people in the UK are still reliant on cash, according to The Treasury.
There were fears that scrapping the smaller denomination coins could impact the elderly, vulnerable and those living in rural communities.
Take part in the 1p coin challengeHERE’S how you could end up with £670 in a year by saving up your spare change:
Start off by putting in 1p into a pot on the first day and increasing it by another penny every day. Like this:
Day 1: Put in £0.01
Day 2: Put in £0.02
Day 3: Put in £0.03
When you reach 100 days, keep doing the same thing but you’ll need to add a £1 coin each day too.
Day 100: Put in £1.00
Day 101: Put in £1.01
Day 102: Put in £1.02
That means that by day 200 you’ll be adding in £2 coins as well as your pennies, and by day 300 you’ll be sticking at least £3 in the jar every day.
Now, it might not sound like much but if you manage to keep it up every day for the next 365 days, you will have tucked away £667.95.
But surveys suggest that six in ten 1p and 2p coins are only used once, while 8 per cent are simply thrown away.
Mr Hammond, said: “Technology has transformed banking for millions of people, making it easier and quicker to carry out financial transactions and pay for services.
“But it’s also clear that many people still rely on cash and I want the public to have choice over how they spend their money.”
The Chancellor is also setting up a group made up of the Treasury, Bank of England and regulators to “safeguard the future of cash and ensure its availability for years to come”.
In addition, Mr Hammond says the Treasury will help to ensure cash is distributed across the country and will develop a new coin checking system to remove counterfeits from circulation.
Natalie Ceeney chair of the Access to Cash review, said: “Cash use is falling rapidly, but digital payments don’t yet work for everyone.
“We need to safeguard the use of cash for those who need it, and at the same time work hard to ensure that everyone can participate in the digital economy.
“If we sleepwalk into a cashless society, millions of people will be left behind.”
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It comes as the end of free cash machine withdrawals looms as almost 1,700 started charging this year.
One British town has NO cash machines with residents forced to cough up £3.50 every time they want money.
Part of the problem is that the fees ATM providers receive from banks was cut in July 2018 by network operator LINK, making it less profitable for them to offer the service for free.
End of free cash machine withdrawals looms as almost 1,700 started charging this year, Which? warns
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