Malaysia Abandons One Sen Coins – Should U.S. Follow Suite with Lincoln Penny?

by on November 14, 2007 · 2 comments

It’s a Sen-sible move. The cost of the Malaysia one Sen coin is too much to bear compared to the value of its use.

Similar to the U.S. Lincoln penny, Malaysia’s smallest coin costs more to make than its worth and its buying power has made the coin less attractive in day-to-day usage.

While the U.S. is considering metal composition changes to reduce the penny cost and is ramping up a Lincoln commemorative coin program starting in 2009, the Malaysian government, like so many others already have, is phasing their smallest coin out.

The one sen will continue to be legal tender. However, by April 1, 2008, Malaysian retailers will begin rounding up or down the total payment due on any over-the-counter transactions. By rounding to the nearest five sen, the usage of the one sen and the need to produce it will evaporate.

Once that’s accomplished, a future decision can be made on whether to demonetize it.

Should the U.S. follow Malaysian’s lead and eliminate the Lincoln penny?

Is Malaysian’s policy something the U.S. and its citizens will watch, learn and follow? If history is any lesson, not any time soon. As mentioned before, many countries have already gone down the path of removing their smallest coin. The U.S. position hasn’t changed.

There’s both good and bad in that. There’s something positive to say in a society that’s willing to lose money over the emotions and memories the Lincoln penny invokes.

However, it’s not easy to argue against the fact that the Lincoln cent is currently costing the U.S. money that could be spent better elsewhere and for good.

For much more information about the one-sen phase out, you can visit and read, Doing away with one-sen coin payment.

{ 2 comments… read them below or add one }

Cody Frommelt December 27, 2008 at 3:43 pm

I am completely for the elimination for the cent. The penny and nickel cost the government about $100 million just in metal costs anyway. Not to mention the shipping and processing of them and the cost of stores using the worthless chunk of metal. I would really like the U.S. to go the way of Fiji and New Zealand by getting rid of the penny and possilby the nickel, and coming out with a cheaper set of larger denomination coin, 5, 10, 20, and 50 cents.

JayKay January 2, 2009 at 9:43 pm

Other countries can eliminate their low-denomination coins and enforce “fair rounding” rules because they don’t have the crazy-quilt of local sales taxes and business laws present in the U.S. I live in a town where there are 3 different sales tax levels within 20 miles and the differential already affects where people shop. If merchants in the high-tax areas were forced to round up further there’d be even more distortions. And what owner would consent to have the government make even more intrusions into their activities by telling them how they had to round the price of every item in their inventory?

BTW, Webmaster, the expression is FOLLOW SUIT, not FOLLOW SUITE.

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