Despite recent inflation, there are no plans to phase out the 5 forint coin from circulation. Notably, the Magyar Nemzeti Bank has not provided any indication regarding the introduction of a higher denomination than the current one.
Addressing the issue, the Magyar Nemzeti Bank (MNB) responded to a query from vg.hu, stating, “As the HUF 5 coins actively participate in cash circulation and show no signs of diminishing in usage, unlike the previous scenario with the withdrawal of HUF 1 and 2 coins, there is currently no intention to withdraw the HUF 5 coins.”
With a current circulation of 825 million 5 forint coins, reclaiming half of them would entail handling more than 1,700 tonnes of coins, incurring significant costs for the MNB. Additionally, these coins demonstrate robust durability and do not need to be scrapped.
Crafted from brass, the five-forint coin has seen an escalation in its production cost. Presently priced at 6 to 8 forints, it is gradually losing relevance due to inflation.
The MNB also indicated whether a denomination higher than HUF 20,000 is expected. “In the MNB’s current cash strategy, the Monetary Council has decided to maintain the current denomination structure, and there is no introduction or inclusion of new banknote or coin denominations on the agenda.” So for the time being, there will be no new denominations, even if there is a demand.
In response to inquiries about the possibility of introducing a denomination higher than HUF 20,000, the MNB clarified, “As per the MNB’s prevailing cash strategy, the Monetary Council has resolved to uphold the current denomination structure, with no plans for the introduction or inclusion of new banknote or coin denominations at this time.” Hence, for the time being, there will be no new denominations, even if there is a demand.
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Can’t we just abolish coins altogether? They make no sense whatsoever in this day and age. Just have every amount available as a paper bill, even the 5 forints.