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Canada: Coins and Cash Acceptance

Categories : Cash ensures competition among payment instruments, Cash is a public good, Cash is the most widely used payment instrument
January 11, 2024
Tags : Acceptance of cash, Canada, Cash cycle efficiency, Mints
The Royal Canadian Mint’s supply of coins has increased after the Covid-19 pandemic. Canadian retailers remain committed to accepting cash transactions.
Manuel A. Bautista-González

Ph.D. in U.S. History, Columbia University in the City of New York

Post-Doctoral Researcher in Global Correspondent Banking, 1870-2000 – Mexico and South America, University of Oxford

This post is also available in: Spanish

Royal Canadian Mint: Coins Are Still Vital

“I think coins and digital payments will coexist for the foreseeable future, so we have to find a way that it’s done seamlessly.” – Marie Lemay, RCM’s president.

Between 2010 and 2020, the Royal Canadian Mint (RCM) produced 6,862,818,500 coins. By denomination, 10-cent coins and 25-cent coins were the most abundant, with 29.7% and 20.4% of the total (see Graph 1), followed by 1-cent coins (19.7%), 5-cent coins (18.5%), 1-dollar coins (7.03%) and 2-dollar coins (4.7%). In December 2022, the RMC issued a special 2-dollar coin with a black outer ring to honor Queen Elizabeth II (1926-2002).

Graph 1. Royal Canadian Mint: Mintage by Denomination, 2010-2020

Source: Royal Canadian Mint (2023).

In February 2013, the RCM stopped producing pennies due to rising costs relative to face value. Since then, the demand for other coins has declined by nearly 8% each year. While the RCM’s supply for coinage dropped 37.8% in 2020 due to the Covid-19 pandemic, the supply increased 9% in 2022 (see Graph 2).

Graph 2. Royal Canadian Mint: Coinage Supply across Canada, 2018-2022

Source: Royal Canadian Mint (2022: 38).

Coin Recycling and Circulation

Canada did not experience disruptions in coins’ circulation as the United States did in 2020, during the Covid-19 pandemic. The RCM manages the national circulation coin management system, working with cash-in-transit companies and financial entities to assess coin demand and ensure coins go to their users, particularly in remote and rural regions with limited banking access and internet connectivity.

“Our goal is to make sure that we are always ensuring that people that want to use coins are able to do it, when and where they want to. […] We have a view into where coins are around the country, and we’re able to forecast. We’re able to move coins around […] and that allows us to have very efficient coin production.” – Marie Lemay, RCM’s president.

The RCM is committed to recycling coins: in 2022, the Mint met 77% of coin demand with recirculating coins, 7% with recycled coins, and the balance with new coin production (Royal Canadian Mint 2022: 15). The Mint encourages Canadians to take their change to Coinstar recycling kiosks at grocery stores to get a cash voucher at checkout or customer service.

Small and Business Retailers Remain Committed to Accepting Cash

“When you give a piece of plastic to your grocer you’re giving a part of yourself. They feel that if a grocer goes cashless it would discriminate against people that actually do use cash, there are many underbanked or unbanked in Canada.” – Sylvain Charlebois, director of Agri-Food Analytics Lab at Dalhousie University.

In July 2023, a convenience store chain opened its first cashless, 24/7 store in Western Canada. “All you need is your phone to enter the store and pay for your go-to favourites,” said Vender Convenience. Customers unlock the store’s doors with their phones, add their purchased goods to the app or scan barcodes, and pay with debit or credit cards.

However, most Canadian retailers have yet to make plans to go cashless soon. In 2021-2022, the Bank of Canada conducted a Merchant Acceptance Survey to monitor payment methods of small and medium businesses (SMBs) in retail trade, food services, and other services.

Graph 3. Canada: Merchants’ Preferences Regarding Payment Methods, 2015-2022

Fuente: Welte, Wu (2023: 17).



This post is also available in: Spanish