Cash rounding
The amount payable for a cash transaction is rounded to the nearest multiple of the minimum currency unit available, whereas transactions paid in other ways are not rounded (for example electronic funds transfer such as with payment cards, or negotiable instruments such as cheques).
Cash rounding typically occurs when low-denomination coins are removed from circulation owing to inflation.
The current level of cash rounding in Sweden is to the closest whole krona, after the 50 öre coin was withdrawn in 2010.
[5] When small-value coins are withdrawn, an alternative to the implementation of cash rounding is instead to increase the minimum unit of account to the smallest remaining currency unit and to round all prices and bank accounts to this value.
Where the unrounded total is an equal distance from two multiples, practice varies: merchants may be required or encouraged to round down rather than up, giving the benefit to the buyer.
The total amount of a bill which ends in 1, 2, 6 and 7 sen will be rounded down while the total bill which ends in 3, 4, 8 and 9 sen will be rounded up to the nearest multiple of 5 sen. [19] In 2004 the Netherlands discontinued issue and use of 1- and 2- euro cent coins for general circulation.
After a successful experiment in the town of Woerden in May 2004, retailers in the whole of the Netherlands have been permitted to round cash transactions to the nearest five cents since September 2004.
All other businesses use only ten-cent intervals as follows: In Sweden between 1985 and 1992, prices were rounded up for sales ending in 5 öre.
The system used in Sweden from 1992 to 2010, in Norway from 1993 to 2012, and in Denmark since 1 October 2008[27] is the following: In practice, the proportion of transactions rounded upwards is greater, due to psychological pricing of items ending in 90–99 öre.
India also uses a similar system since 2019, as the 50-paisa coin is seldom seen in circulation due to its negligible value.
[29] In Mexico there is a trend for most supermarkets to ask customers whether to round the total to the nearest 50¢ or the whole peso to automatically donate the difference to charities.
