Germany’s National Cash Forum is now advocating rounding to the nearest five euro cents for cash payments, asking the Federal Ministry of Finance to follow suit and ‘advocate for, and press ahead with, a binding statutory rounding rule in Germany’. As part of the Forum’s announcement, it wrote that the rounding rule should be applied across Europe as uniformly as possible.
The National Cash Forum was established in February 2024 on the initiative of the Bundesbank with the objective of securing cash as a widely used means of payment and maintaining its availability. The Forum is made up of representatives from the associations of the banking industry, retail trade, consumer protection, the CIT industry, and vending machine operators.
The lack of popularity of low value coins was cited in favour of the introduction of cash rounding, with the Forum remarking on results from the latest Eurobarometer, which found that the majority of respondents were in favour of abolishing one and two cent coins.
The lack of return of these coins to national central banks, as well as the economic and environmental costs of producing, packaging and transporting coins, were also included as arguments in favour of the new policy.
‘If we discontinued the circulation of 1 and 2 cent coins, cash would become more appealing to users. In addition, the cash cycle would be more sustainable and efficient’, explained Burkhard Balz, member of the Bundesbank Executive Board and Chair of the National Cash Forum.
If introduced, Germany would follow several fellow eurosystem countries, including Finland, the Netherlands, Estonia, Belgium, Italy, and Ireland. Lithuania is also set to introduce cash rounding from 1 May. The Forum commented that cash rounding is ‘already common practice in some European countries’, although a ‘single European solution is yet to be found’.
