By Choi Sung-jin
The Bank of Korea says it will consider ways to minimize coin use this year, to move eventually to a “coinless society.”
Under the central bank’s plan, people who pay cash will receive change not in coins but in cards, officials said. For instance, if you give 10,000 won for a 9,500-won item, vendors will deposit 500 won to your card connected to an imaginary account.
“We spend more than 50 billion won ($41.5 million) a year making coins, and the cost society pays for their circulation reaches several times the amount,” a BOK official said Tuesday. “If we change this settlement system to cards, not just the financial sector but the whole society can save unnecessary costs.”
For instance, the police recently arrested a group of people who raked in 200 million won by melting 6 million 10-won coins and reselling the copper. Some 25 won of copper is used to mint a 10-won coin.
The central bank ultimately aims to move to a “cashless society,” and a coinless society is its transitory phase, they said. The cash payment ratio of Sweden, for example, is about 20 percent, far lower than the average 75 percent for other countries. The bank, however, is not considering going as far as banning coins. “There still remain many legal obstacles for us to directly transit to a cashless society,” the official said.
By most accounts, the BOK expects to introduce the coinless society by 2020, they said.