Not so loose change

Sri Lankans leave so many coins in India that the central bank is running out

January 8, 2014
January 8, 2014

Sri Lanka is facing an unusual currency crisis: a pilgrim-driven coin shortage. Nearly 20 tonnes (22 tons) of Sri Lankan coins are laying unused in Buddhist temples in India, left by Lankans on pilgrimage, according to the country’s central bank. The Sri Lankan government is currently negotiating with Indian officials to have them sent back.

A coin deficit has been an on-and-off again problem in Sri Lanka because coins are used for a variety of tasks aside from small-scale financial tender. Religious pilgrims leave them in temples as offerings, and drivers also keep blessed coins in their cars for good fortune. Melting coins into jewelry is so common that the central bank is explicit that the practice is illegal, and some coins function as better washers for nuts and bolts than those at the hardware store.

While some countries are happy to do away with their small change, Sri Lanka has been reluctant to give up its coins—the smallest of which is the one cent rupee, worth about 1/126th of a US penny—possibly because past fears of inflation have just started to level off.

The government says an additional 2 billion coins are in people’s homes, tucked away in drawers and saving tills. In 2007, officials tried to deal with that problem by asking children across the country to raid their piggy banks. India is unlikely to be receptive to a similar request.

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