Refusing Pesewa Coins is illegal and drives inflation - BoG warns Traders

The Bank of Ghana has warned traders and the public against refusing lower-denomination coins, cautioning that such practices could undermine price stability and contribute to inflationary pressures.

In a publication following its March 2026 bi-monthly media engagement, the Bank emphasized that coins such as the one pesewa, five pesewas, and 20 pesewas remain legal tender and must be accepted in all transactions. Under the Currency Act, 1964 (Act 242), no individual or business is permitted to reject officially issued currency when making payments.

The warning comes amid persistent reports that some traders—particularly in markets and the transport sector—are increasingly refusing smaller coins, often rounding up prices or imposing higher minimum charges. According to the Bank, this behaviour distorts pricing and can gradually push up the cost of goods and services.

While the use of smaller denominations naturally declines over time due to inflation and reduced purchasing power, the Bank stressed that outright rejection poses a risk to the broader economy. Systematic price rounding, it explained, can contribute to inflation and reduce the efficiency of everyday transactions.

The Bank noted that ensuring the continued circulation of coins requires not just supply but also public acceptance and compliance with legal tender regulations. Traders, transport operators, and market associations are expected to honour all denominations in daily transactions.

To address the issue, the Bank of Ghana said it is intensifying public education campaigns to raise awareness about the legal status of coins and the economic impact of rejecting them. It also plans deeper engagement with informal sector stakeholders to encourage compliance and behavioural change.

In addition, the Bank is working with financial institutions to improve the distribution and recirculation of coins, ensuring they remain accessible for daily use. Public warnings have also been issued, reminding citizens that refusing coins is illegal and explaining how such practices contribute to inflation through price rounding.

The central bank said these combined efforts aim to maintain efficient currency circulation, safeguard price stability, and ensure all forms of legal tender continue to serve their intended role in the economy.