Swedish rounding is rounding the basic cost of a purchase which is to be paid for in cash to the nearest multiple of the smallest denomination of currency. The term "Swedish rounding" is used mostly in Australia and New Zealand, where such a method has been practised since the 1990s.[dubious ]
Rounding becomes necessary where low denomination coins in a currency are withdrawn or otherwise made unavailable, but the currency's subdivisions remain the same. Since it may not be possible to make exact change for a purchase, rounding the total bill to the lowest available denomination of coinage is required if a customer is paying in cash. If payment is being tendered using credit card, debit card, EFTPOS or cheque, no rounding is necessary.
The practice was introduced in Sweden following the removal of 1 and 2 öre coins from circulation in 1972. It is called "öresavrundning", meaning "öre rounding". A similar system was later adopted by the Reserve Bank of New Zealand in 1990, when the 1 and 2 cent coins were removed from circulation, and the Reserve Bank of Australia which did the same for its own currency in 1993.
In countries with 0.01 coins, many shops avoid the need for the smallest coins by having all prices rounded to 0.05 or 0.10.
Rounding with 0.05 intervals
|Argentina||always rounded down|
|Bosnia and Herzegovina|
|Canada||2013 onward||Penny no longer produced as of 2012. After February 4, 2013 penny no longer distributed by banks. Electronic transactions are still completed to $0.01|
|Chile||1 peso coins are legal but rare, prices are rounded to the nearest 5 pesos using the same system.|
|Hong Kong||1989 to 1995|
|Republic of Ireland||2015 onwards||A National Payments Plan in April 2013 planned "to trial the use of a rounding convention in a pilot project in a mid-size Irish town", with the 1¢ and 2¢ no longer being minted while remaining legal tender. The trial in Wexford was declared successful in June 2015 and rounding to the nearest 5c will commence on 28 October 2015.|
|Malaysia||though 1 sen coins are still legal tender|
|The Netherlands||2004 onwards||The Netherlands did so under pressure from retail businesses, which claimed that dealing with 1- and 2-cent coins was too expensive. 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-cent since September 2004.|
|New Zealand||1990 to 2006|
|South Africa||2002 onwards||rounding is done to the nearest 5c),|
|Sweden||1972 to 1985|
|Turkey||1 kuruş coin can still be used|
- Prices are rounded down to the nearest multiple of 5 cents for sales ending in: 1¢ & 2¢ to 0¢; and, 6¢ & 7¢ to 5¢;
- Prices are rounded up to the nearest multiple of 5 cents for sales ending in: 3¢ & 4¢ round to 5¢; and, 8¢ & 9¢ round to 10¢
- Values ending in 0¢ or 5¢ remain unchanged.
Rounding with 0.10 intervals
This is currently used in New Zealand, which eliminated its 5 cent coin in 2006. This is also the case in Hong Kong, which eliminated its 5 cent coin in 1989 and 1 cent note in 1995. In practice only utility bills, petrol stations and banks still keep the cent. All other businesses use only ten cent intervals.
- round down to the nearest 10 cent value for sales ending in 1¢, 2¢, 3¢, 4¢, 5¢;
- round up to the nearest 10 cent value for sales ending in 6¢, 7¢, 8¢, 9¢;
- In NZ, it is up to the business to decide if they will round 5¢ intervals up or down. The majority of retailers follow government advice and round it down.
In Sweden between 1985 and 1992, prices were rounded up for sales ending in 5 öre.
In the People's Republic of China, coins smaller than ¥0.10 are now rare though still valid. As a result, many shops simply truncate their bills down to the next ¥0.10 increment, giving the customer a discount of up to ¥0.09.
Rounding with 0.50 intervals
- Sales ending in 1–24 öre round down to 0 öre.
- Sales ending in 25–49 öre round up to 50 öre.
- Sales ending in 51–74 öre round down to 50 öre.
- Sales ending in 75–99 öre round up to the next whole Krone/krona.
In practice, the proportion of transactions rounded upwards is greater, due to psychological pricing of items ending in 90–99 öre. Rounding is only done on the total sum of a purchase, which makes that effect smaller. In some shops, however, one may find that all prices are already rounded to the whole krone, so that no rounding takes place.
Rounding with 1.00 intervals
- Sales ending in 1–49 öre/øre round down to 0 öre/øre.
- Sales ending in 50–99 öre/øre round up to the next whole krona/krone.
- Laki euromääräisten maksujen pyöristämisestä
- "Written Answers 23960/13: Euro Coins Production". Dáil debates (Oireachtas). Unrevised: 57. 21 May 2013. Retrieved 26 May 2013.
- Castle, Stephen (September 16, 2004). "Smallest Euro coins dropped by two nations". Independent, The (London). Archived from the original on January 24, 2007. Retrieved 2008-07-15.
- "Cessation of minting of 1 & 2 Cent Coins". South African Government Information. 2002-03-22. Retrieved 2008-08-14.
- "Change for the Better: Questions and Answers". Reserve Bank of New Zealand. Retrieved 2009-01-28.
- "New rounding rules". Danmarks Nationalbank. Retrieved 2010-05-02.
- Such prices are for example visible in (click the image)
- "Regulation relating to withdrawal of 50-öre coins as legal tender". Norges Bank. Retrieved 2011-05-09.