In Italy, a bottle of wine may cost you 800 lira (about US 0.90 cents) but you risk not getting change from 1,000 lira note.
In Italy, a bottle of wine may cost you 800 lira (about US 0.90 cents) but you risk not getting change from 1,000 lira note. Instead you might have to accept a few sweets, or special telephone coins. This is because of a chronic shortage of change that has affected the country for years. The Government mint is old and inefficient and in spite of stepping up production in recent years it still can not cope with demands. Another problem contributing to the coin shortage is inflation, which has made Italy's smallest denomination coins of five, ten and 20 lire almost worthless. The answer could be mini-cheques.
SYNOPSIS: At the Palace of Expositions in Rome a variety of mini-cheques were displayed in a big hobbies show. These have been issued by many Italian banks since a court decision last year decreed they were legal. Hundreds of thousands of the tiny notes have come into circulation, many of them worth as little as 50 lira (about 1/2 a cent), and are in effect tiny cheques which the banks will honour. Banks must keep in reserve the equivalent amount in 'real' money to the sum of the mini-cheques they have issued.
In recent years shoppers in Italy had been becoming increasingly irate at being given eggs, fruit, sweets....or anything but small change when making purchases. The introduction of the mini-cheques however, has helped alleviate the problem. Now shoppers can accumulate a number of mini-cheques and cash them at the banks when they have a worthwhile amount to exchange. The situation was improving .... that was until recently when speculators got in on the mini-cheque market.
Now public transport companies in Rome and other cities are refusing to accept mini-cheques, along with some shopkeepers. It seems speculators have been buying the mini-cheques on the cheap, and making a profit on them. So, unless a solution's found, Italy could soon be back to eggs, onions, sweets...and anything but small change.