Canada isn't going to mint pennies any longer. It costs the Canadian government 1.6 cents for every penny made. Beginning next week (Feb. 4), the country will begin phasing out the currency.
According to a survey conducted by the Retail Council of Canada, roughly 53 percent of Canadian merchants will be ready next week when the change starts to take place. Twenty-four percent are not ready and the rest are unsure as to whether they are prepared for the phase out or not.
"In the short term, there is going to be a bit of confusion," Karen Proud, a vice president at the Retail Council of Canada, told the Ottawa Citizen.
As to what retailers will do when they run out of pennies to make change, 56.4 percent plan to follow the Canadian federal government's guidelines for cash transactions. Nineteen percent will round down transactions to the nearest five or 10 cents.
The vast majority of stores (66.8 percent) plan to handle rounding manually at the point of sale while 24.2 percent have programmed their POS systems to automate the process.
The relative value of pennies is also a topic that has been broached in the U.S. over the years. While estimates vary depending on the current market cost of the metals used in the production of a penny, in 2012 it cost the U.S. Treasury 2.4 cents to make a cent. Nickels cost 11.2 cents to produce.
Should the retail industry lobby the U.S. government to phase out the penny?