Megan Brooks
The acceptance of 1-cent coins varies by country and bank. In the United States, for example, the Federal Reserve Banks distribute new and circulated coins to depository institutions, which then provide them to the public. There is no federal statute requiring private businesses, individuals, or organizations to accept coins or currency as payment. Similarly, Australian 1-cent coins are no longer in circulation but remain legal tender, and banks will exchange them for face value. However, vending machines, parking meters, and road toll collection points often refuse low-denomination coins.
| Characteristics | Values |
|---|---|
| Copper 1 cent coins were withdrawn from circulation in 1992 | Still legal tender but not considered currency |
| Coins are legal tender for payment of amounts not exceeding 20 cents if 1 cent and/or 2 cent coins are offered | Up to 10 2 cent coins or 20 1 cent coins can be used in a transaction |
| Coins can be exchanged with banks for face value | Banks may require a Mutilated Coin Claim form for mutilated coins |
| Coins may be worth more to collectors than their face value | Defacing coins is a criminal offence under the Crimes (Currency) Act 1981 |
| Australian currency has legal tender status | Refusal to accept payment in legal tender coins is not unlawful |
| Federal Reserve Banks distribute new and circulated coins to depository institutions | The United States Mint is the issuing authority for coins |
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What You'll Learn
- Banks in Australia accept 1 cent coins, but only up to 20 cents worth
- Mutilated coins can be returned to banks, but they may only be worth scrap metal value
- In the US, the Federal Reserve Banks distribute coins to meet public demand
- In the US, there is no law requiring private businesses to accept coins as payment
- $2 bills can be ordered from Federal Reserve Banks if your bank doesn't have them
Banks in Australia accept 1 cent coins, but only up to 20 cents worth
Although 1 cent coins are no longer in circulation, they are still considered legal tender in Australia. However, there are restrictions on how much can be paid in coins. According to the Currency Act 1965, if paying with 1 cent coins, the amount paid cannot exceed 20 cents. This means that you can only use up to 20 1 cent coins in a transaction. Banks in Australia will accept 1 cent coins, but only up to 20 cents worth, and will exchange them for their face value.
It is important to note that while Australian coins are legal tender, there is no law compelling anyone to accept them as payment. For example, some vending machines, parking meters, and road toll collection points do not accept low-denomination coins. Additionally, businesses have the right to refuse cash or coin payments if they choose to.
The value of old coins that are no longer in circulation may be higher to collectors than their face value. For instance, pre-decimal coins and shillings minted between 1910 and 1920 can be worth much more than their original value to coin collectors. Similarly, 1 cent coins may be worth more to a coin collector than their face value.
It is also worth mentioning that defacing, destroying, selling, or possessing defaced Australian coins is a criminal offence under the Crimes (Currency) Act 1981, with penalties including a fine of up to $5000 or imprisonment for up to two years.
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Mutilated coins can be returned to banks, but they may only be worth scrap metal value
In Australia, damaged and worn coins are not considered valid currency, but they can be returned to your bank for face value. If you have mutilated coins that are not readily identifiable as coins, your bank will require you to complete a Mutilated Coin Claim form. Your deposit will then be sent to the Royal Australian Mint for processing. If your mutilated coins are accepted, the Mint will pay you the scrap metal value, not the full face value of the coin.
It is a criminal offence under the Crimes (Currency) Act 1981 to deface or destroy an Australian coin. Defacing includes coating the surface of the coin with any sort of material. The penalty for defacing, selling, or possessing defaced coins is a $5000 fine or imprisonment for two years.
In the US, the Mint Mutilated Coin Redemption Program allows people to get money for their damaged coins. However, the program has been temporarily suspended due to concerns about potentially counterfeit coins being submitted to the US Mint from China. The US Mint plans to restart the program once it determines how to make the initiative more secure.
Even if a coin is totally ruined, its metal content is still worth something, especially if it is made of precious rare metals like gold, silver, or platinum. The melt value of a coin is what the metal of the coin is worth if it were to be melted down.
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In the US, the Federal Reserve Banks distribute coins to meet public demand
The Federal Reserve Banks play a crucial role in ensuring that there is an adequate supply of currency and coins to meet the public's demand in the United States. The Federal Reserve Board determines the number of new Federal Reserve notes required each year and places an order with the Treasury's Bureau of Engraving and Printing (BEP). The Federal Reserve Banks then distribute these notes to depository institutions, which include commercial banks, savings and loans associations, and credit unions.
The Reserve Banks are responsible for distributing new and circulated coins to these depository institutions to meet the public's demand. They order coins from the United States Mint, the issuing authority for coins, and manage the inventory of coins held in their vaults and in coin terminals operated by armored carriers. The Reserve Banks also receive coins from depository institutions when they have more than they need to meet demand, such as after the holiday season.
The process of ordering and distributing coins is carefully managed to ensure that depository institutions have enough coins to meet the public's demand and to avoid unnecessary coin production costs. The Federal Reserve Banks provide strategic leadership to their cash departments and work closely with the Federal Reserve System's Cash Product Office (CPO) to maintain public confidence in U.S. currency.
While the Federal Reserve Banks play a vital role in coin distribution, their role in coin operations is more limited compared to their involvement in currency operations. The United States Mint determines the annual coin production, with input from the Reserve Banks through their monthly coin orders and 12-month rolling coin-order forecasts.
Regarding one-cent coins specifically, there has been a recent development as of May 2025. The US Treasury has decided to end the production of one-cent coins, commonly known as pennies. This decision was influenced by the high cost of producing pennies, which exceeded their face value due to rising metal prices. President Donald Trump supported this move, citing unnecessary government spending. While pennies will remain legal tender, their availability will gradually decrease as they fall out of circulation.
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In the US, there is no law requiring private businesses to accept coins as payment
In the United States, the Federal Reserve notes that there is no federal statute requiring private businesses, individuals, or organizations to accept currency or coins as payment for goods or services. Private businesses are free to develop their own policies on whether to accept cash unless there is a state law that says otherwise. This means that private businesses can refuse to accept coins, including 1-cent coins, as a form of payment if they so choose.
However, it is important to note that according to Section 31 U.S.C. 5103, titled "Legal Tender," all US coins and currency are considered legal tender for debts, public charges, taxes, and dues. This statute ensures that all US money is a valid and legal offer of payment when tendered to a creditor. For example, a landlord who refuses a tenant's payment of rent in cash may result in the tenant being excused from paying rent for that period.
While there is no federal mandate, some states have implemented laws requiring businesses to accept cash and coins as payment. For instance, California has landlord-tenant laws that require landlords to accept cash payments, and Massachusetts and New Jersey have laws in place that mandate businesses to accept cash payments.
Businesses that conduct cash transactions may find it inconvenient to accept large amounts of coins, especially if the coins are not rolled, as most banks charge processing fees for unrolled coins. This can result in additional costs for businesses, and they may choose to refuse such payments or request that customers bear the processing fees.
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$2 bills can be ordered from Federal Reserve Banks if your bank doesn't have them
Banks generally still accept 1-cent coins, but they are no longer produced as of 2012. They are still legal tender, but some banks may refuse them as they are not in circulation.
Regarding $2 bills, these are also legal tender, and local banks should have them. If your bank does not have any, they can be ordered from the Federal Reserve Bank, which distributes Federal Reserve notes to the public through depository institutions. The Federal Reserve Board projects the need for new currency each year and acquires it from the Department of Treasury's Bureau of Engraving and Printing. The Federal Reserve Bank may also accept commercial bank requests for new currency at different times throughout the year.
The minimum order quantity for $2 bills from the Federal Reserve varies according to different sources. One source states that the minimum order is $50, while another mentions that the minimum quantity sent from the Fed for some bills is $2,000. However, it is worth noting that banks may be reluctant to order large quantities of $2 bills due to storage limitations and the potential for slow turnover.
It is recommended to contact your banking institution to see if they can honor your request for specific notes or coins. Additionally, it is worth noting that the Federal Reserve does not accept deposits of mutilated currency. Any mutilated currency must be sent directly to the BEP with an estimated value and an explanation of how it became mutilated.
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Frequently asked questions
Yes, banks in Australia still accept 1 cent coins. While copper 1 cent coins were last minted 30 years ago and withdrawn from circulation in 1992, they are still legal tender and can be exchanged with banks for face value.
Banks in the US are not required by federal law to accept currency or coins as payment for goods or services. However, they do provide currency to depository institutions, which then distribute it to members of the public. It is recommended that you contact your local bank to see if it will accept your 1 cent coins.
In Australia, there are restrictions on the amount of 1 cent coins that can be used in a transaction. According to the Currency Act 1965, payments made in 1 cent coins are limited to 20 cents.
Please note that I am only able to provide a response regarding Australia and the US. For information on other countries, please specify the country in your request.
