The apparent refusal by some commercial drivers and traders to accept lower-denomination coins is creating a quiet form of price inflation that deserves the immediate attention of the Government.
The issue may seem trivial, but it has a direct bearing on what Ghanaians actually pay for goods and services. When a driver or trader refuses to accept 10 or 20 pesewas and instead rounds a fare or price upwards, the consumer pays more than the actual or approved price.
This is particularly worrying in the transport sector. A few weeks ago, the Ghana Private Road Transport Union (GPRTU) announced an eight per cent increase in transport fares. Yet The Chronicle has received concerns that some commuters are effectively paying more than the approved adjustment, with fares reportedly being rounded upwards to 10 per cent or even higher.
Where an eight per cent adjustment requires an additional 10 or 20 pesewas, for instance, a commuter may instead be asked to pay an additional GH¢1 because the driver does not want to deal with the smaller denomination.
The result is simple: the commuter pays more than the approved fare. The Chronicle is not suggesting that the refusal to accept small-denomination coins is, by itself, responsible for Ghana’s inflation. National inflation is driven by a much broader combination of monetary conditions, exchange-rate movements, fiscal developments, supply constraints and demand pressures.
Our concern is that widespread upward rounding can add to those price pressures. If a commodity costs 80 pesewas but a trader refuses to accept a 20-pesewa coin and charges GH¢1 instead, the consumer has effectively suffered a 20-pesewas price increase.
When similar practices occur repeatedly across thousands of daily transactions, they can cumulatively increase the amount households spend on basic goods and services. For low-income households, these seemingly small increases matter.
The same practice could also spread beyond transportation. If market women and other traders begin refusing 10 and 20 pesewa coins, prices could increasingly be rounded upwards. An item that should cost 80 pesewas could become GH¢1, not because its underlying cost has increased, but simply because the seller does not want to accept the smaller denomination.
That is an unnecessary burden on consumers and a development that authorities should not ignore. Transportation is particularly important because its effects can extend throughout the economy. Higher transport costs can increase the cost of moving food, merchandise and workers, with businesses potentially passing some of those additional costs on to consumers.
The Government must, therefore, establish whether transport operators are charging above the approved eight per cent adjustment.
If the approved fares are being exceeded in practice, the relevant authorities must intervene. An officially announced fare adjustment should mean exactly that. Commuters should not be subjected to additional increases through informal rounding practices.
The Ministry of Transport and other relevant agencies should engage the GPRTU and establish the extent to which such practices are occurring.
The Bank of Ghana should also take an interest in the wider issue of the declining practical use of lower-denomination coins. If coins remain legal tender, consumers should not routinely be disadvantaged because some businesses or transport operators find them inconvenient.
We appreciate that very small denominations can create practical difficulties in everyday transactions. But the solution cannot be to allow arbitrary upward rounding to become the norm.
At a time when the Government is seeking to stabilise the economy, contain inflation and restore the purchasing power of Ghanaians, every avoidable source of price pressure deserves attention.
The Government must establish the facts, enforce approved transport fares and ensure that the country’s legal tender is respected.
The Chronicle believes Ghanaians are already struggling with the cost of living. They should not have to pay more simply because a driver or trader does not want to accept the coins that remain part of the country’s legal tender.
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