Tesco to defy Royal Mint over old £1 coins

TESCO will continue to accept old-style £1 coins for another week after the supermarket announced it was ignoring a deadline set by the Royal Mint.

The UK’S biggest supermarket will let shoppers pay with the coins for an extra seven days beyond the official Royal Mint deadline of Oct 15, when they cease to be legal tender.

On Sunday, business groups were encouraging shops to defy the deadline, despite officials warning that doing so could result in widespread chaos and confusion.

Tesco’s about-turn will come as a major embarrassment to the Treasury and the Royal Mint, which until last night had been under the impression that all supermarkets would stop accepting old pound coins on Sunday.

Tesco said it changed its policy at the last minute as it wanted to “do the right thing for customers”.

There are still around 500 million old pound coins in circulation. From Sunday, shops will be banned from giv- ing them out as change. The Royal Mint and the Treasury have told businesses that they want a “clean break” from the round pound to avoid potential chaos being created by some shops continuing to accept them as payment.

Officials are worried that a “messy” transitional phase would lead to customers getting confused about which coins they could use, as well as creating hassle for banks that would have to separate old and new coins long after the deadline had passed.

Tesco’s seven-day extension comes less than 24 hours after Poundland announced it would defy the Mint’s

cut-off and continue to accept old pound coins for an extra two weeks.

In addition a trade association representing 170,000 shops advised its members to continue taking the round £1 coins after Sunday to provide a “useful community service” to customers.

The British Retail Consortium, which represents retailers in the UK, said: “Some retailers may choose to have a more flexible policy – that is for them to decide.”

The comment came despite the body previously having issued members with Royal Mint guidance saying retailers should stick to the deadline.

Andrew Cregan, director at the British Retail Consortium, added: “The introduction of the new £1 is a significant change for the retail industry, and so far the sector has done a great job of addressing the changeover and communicating with staff and customers.

“We have worked closely with HM Treasury and the Royal Mint for several years to prepare businesses. They have been clear in their communication to staff and customers to be ready for the cut-off date.”

A Tesco spokesman added: “We’ve been updating our systems ready for the new pound coins, but to help customers who still have the old coins, we’ll continue to accept round pounds at our tills and self-service machines for an additional week.”

A Treasury spokesman said: “The new pound coin was brought in to reduce the multi-million-pound cost to British business from counterfeits.

“Businesses told us they wanted certainty on a cut-off date, which is why we introduced the October 15 deadline.

“We have worked tirelessly with businesses for several years to support their preparations for this, including launching a campaign a year ago to help firms educate their workers.

“The small minority who choose to keep accepting the old coin, after it ceases to be legal tender, will have to make their own arrangements with their banks.”