The future of currency in Canada
Canada just recently announced plans to phase out the penny, seen here, and now it's looking to bring it back -- in digital form.
Jeremy Hobson: Canada just recently announced plans to phase out the penny. And there's already talk about bringing it back -- in digital form. The Royal Canadian Mint wants help developing something called the MintChip.
Scott Peterson covers business for the Canadian Broadcasting Corporation and he joins us now from Toronto. Good morning.
Scott Peterson: Good morning, Jeremy.
Hobson: When I hear MintChip, I think it's like my favorite kind of ice cream. But tell us what it is in this case.
Peterson: Yeah it's not a Rocky Road. It's like a debit card, basically. What we're doing here is the Canadian mint -- which is the goverment basically out of Ottawa -- wants to come up with this so-called MintChip, which it's a prototype at this point. It's almost kind of like a debit card or an app in your computer or even something you can download like a USB stick, basically to pay for what they're calling "micro-transactions," and that's anything under $10. So basically you can have this instead of cash.
Hobson: But how does it work? Because it's not tied to your bank account, so I guess technically then you wouldn't have to have the money in order to spend it, right?
Peterson: Yeah, part of the appeal here is that there's no personal information attached, because a lot of people, if you're surfing the web and buying something off the web, you're afraid of downloading that personal information. So that's why they're calling for applications right now, for developers. It's basically we're going to find at the end of summer who's won this contest, and it's basically how to define this thing -- how does it work? Whether it's going to be a chip that we carry around on our card, whether it's something we can swipe. Starbucks has already, for example, you can swipe your phone up against the computer. So at this point, we're waiting for these app developers. There's a $50,000 prize attached to this, so it's a bit of a question mark exactly how this thing will work.
Hobson: Well are there concerns already about not having a physical currency?
Peterson: Yeah, there's a lot of people who are asking the same thing, like: What happens if you load up your card with a lot of money and you lose it? I mean, so there is some question marks. We're expecting that to be flushed out from this app developers as far as having some sort of security or the ability to cancel it. But at this point, you're right -- it's a double-edged sword. In one essence, you have no personal information attached to it, and on the other, it's how to make that a little more secure.
Hobson: Scott Peterson with the CBC, joining us from Toronto. Thanks a lot.
Peterson: Thanks Jeremy.