Thursday, November 6, 2014

Making payments with coins in Singapore

Can you legally make large payments in coins? There have been recent articles about people and stores using large numbers of small denomination coins to make substantial payments.

One chap left $19,000 in 20cent coins in a car dealer's showroom. The coins were estimated to weigh at least 100 kg and reeked of fish!

Straits Times has reported that under the Currency Act, the following rules apply.

1) Any sum can be paid in coins with a denomination exceeding 50 cents; in other words a one dollar coin in Singapore since we do not have coins with a larger denomination.
2) 50 cent coins can be used for a sum not more than $10
3) Coins of a denomination lower than 50 cents can be used for a payment of a sum not more than $2.

It looks like this Mr Lester Ong has flouted the Currency Act since he used 20cent coins to pay a sum of $19,000. If he had used $1 coins, it would still be legal.

Which begs the question, why is there no limit in payment for $1 coins? Surely it is not reasonable to pay huge sums in $1 coins. In this case, you would need 19,000 of $1 coins to pay $19,000.

According to the MAS website, the new $1 coin weighs 7.62g each. So 19,000 of such coins would weigh 144.78kg!

Thanks for reading.

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