Time for change

It is the most banal of transactions, one that plays out on city buses across the country every single day. A commuter boards a bus, takes out some change, carefully counts it out, and hands it over to the conductor. The conductor, in turn, examines each coin and hands over the change if any to the passenger, again after a thorough check.

It isn’t just on buses. This very scene plays out in every transaction involving small change, be it at a paan or cigarette shop, a roadside food vendor, a drug store or a bakery. The due diligence by both sides is understandable, given that ₹1 and ₹2 coins, by far the most common, look similar. They’re both made of ferritic stainless steel and are pretty much the same size. True, some of the new ₹1 coins are smaller, but then they are often confused with the 50 paise coin, which still pops up now and then.

In itself, each transaction is harmless. But when it is repeated across the country millions of times, every single day, it translates into a needless waste of time, of productive manhours lost.

A case in point: the city buses in Bengaluru; conductors there are known to often make unscheduled stops of crowded buses so they can make their way to all the passengers collecting fares, diligently examining each coin they receive and hand back. Never mind that the bus, jammed with 60-70 people, is needlessly delayed in a city where traffic is gridlocked even on a good day.

For the affluent, all this may seem a minor irritant, unworthy of attention. But for the poor, every little paisa counts. It goes a good way in helping them make ends meet, a rupee saved being a rupee earned. They can ill afford to lose ₹2 thinking it was a ₹1 coin.

A few decades ago, things were far easier, even though there were coins in many more denominations. We had 1 paise, 2 paise, 3 paise, 5 paise, 10 paise, 25 paise, 50 paise and ₹1 coins. And yet, it was impossible to mistake one for the other, as each had a unique shape and/or size. And mind you, one could actually purchase an item or two even with 1 paise.

Even today, it is impossible to mistake the ₹5 cupronickel coin for any other denomination, and likewise the new ₹10 coin.

In sum, there is a case here for another round of demonetisation, in a manner of speaking. The government should seriously consider withdrawing ₹1 and ₹2 coins (or at least one of them) and issuing new ones with distinct features. All that it will take is a half-decent imagination to design coins with unique shapes and sizes. And voila, everyone will be able to quickly dispense and accept change. And keep those buses running.

But the Central government, quite literally, is the only institution that can make this happen. While coins can be issued for circulation only by the Reserve Bank, the right to mint them lies solely with the Government of India, under the Coinage Act, 1906, with all its amendments. The designing of coins in various denominations is also the responsibility of the Government of India. And it would do well to seize this low-hanging fruit and earn praises for taking a bold, decisive step.

It won’t wipe out black money, and it most certainly will not advance the digital-transaction agenda. But it will make it easier for millions of Indians to do business.

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