Coins return to the Kenyan market amid tough economic times, CBK report
Coins return to the Kenyan market as broke Kenyans face tougher times according to Central Bank of Kenya data.
In the 12 months leading up to June of this year, coin circulation increased at its quickest rate in four years, fueled by a tighter financial situation that caused more Kenyans to use low-value currencies to pay for goods and services.
According to figures from the Central Bank of Kenya (CBK), the value of coins in circulation reached a record high of Sh10.15 billion in the year to June, an increase of 4.1% from Sh9.75 billion the previous year.
This is the fastest growth in circulation since June 2017, when it went from Sh8.19 billion to Sh8.89 billion, an increase of 8.54 percent.
This demonstrates that, in spite of a five-year high inflation rate, more people are using their idle coin savings to pay for low-value transactions.
Previous CBK data indicated that there were Sh1 and 50-cent coins out of circulation worth about Sh995 million.
The majority of them are coins that are typically given as change during transactions, but they are stored away and frequently ignored.
Tough times are now forcing consumers to mop up the coins for use.
Kenya has five denominations of Sh1, Sh5, Sh10, Sh20, and Sh40 coins in circulation.
However, CBK discontinued the printing of the Sh40 coin in December 2018 after issuing a new generation of currency coins.
CBK issued a new generation of coins and banknotes on December 11, 2018, and May 31, 2019, respectively.
The new generation currency was designed to conform to the requirements of the Constitution that was passed in 2010.
Bank notes, however, remain the most preferred means by consumers to settle payments.
Coins make up just 3.32 percent of the total currency in circulation. In some sections of the country, retailers were rejecting Sh1 coins, leading to price distortion.
Also read,
Kenya’s dollar import cover sinks to a seven-year low amid a high inflation rate
Currency in circulation hits a record of Sh261.5 billion
Hard times as Kenya’s debt hits a record Sh8.61trn
CBK moves to tame the rate of inflation amid the high cost of living
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