Even though the GHS1 and GHS2 banknotes remain legal tender in Ghana, the Bank of Ghana (BoG) will phase them out and substitute them with coins.
Following the introduction of a GHS 2 coin together with new GHS100 and GHS200 banknotes, the central bank said in a statement on Friday, 29 November 2019 that it “intends to gradually replace its lower banknotes denominations with coins to reduce its cost of printing”.
The apex bank further said that it will also “embark on a vigorous campaign among road transport workers, market operators, small businesses, supermarkets, vendors and others to create avenues for the usage of the coins” and also “develop infrastructure for coin usage”.
The central bank also explained that the introduction of the new GHS100 and GHS200 banknotes is to “address the deadweight burden on the economy from the past inflation and cedi depreciation”.
According to the BoG, the structure of the banknotes has changed, resulting in a shift in demand for higher denominations with GHS50 and GHS20 accounting for about 70% of the total demand, reflecting the expansion in income and prices.
The “introduction of the higher-value denominations in circulation is, therefore, necessary to ensure customer convenience, reduction in the costs of printing and other currency management processes”, the BoG underscored.