Swedish rounding
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Swedish rounding is a method by which money is rounded from a given minimal unit to the closest larger unit represented by physical currency. It is generally a method of rounding which is recommended by a country's Reserve Bank or Retailers Association, however is very rarely a legal requirement to follow.
[edit] Usage
In New Zealand and Australia it is the common method of rounding in retail outlets. It is also commonly, though unofficially used throughout many parts of Europe using the euro.
The given prices of items may still be retained to the cent; for example, the price of a loaf of bread may be given as $0.99. The total of the purchases is then rounded to the nearest physical currency unit, but only if a consumer is paying by cash, as opposed to credit card, debit card, EFTPOS or cheque. In the latter cases, no rounding occurs.
In Australia, prices given in cents are rounded to the nearest twentieth of a dollar when the consumer is paying with physical currency. E.g., $20.42 rounds down to $20.40, while $20.43 rounds up to $20.45.
In New Zealand, prices given in cents are rounded to the nearest tenth of a dollar following changes to New Zealand currency in August 2006.
[edit] History
The term came to popular use in New Zealand in 1990, when the 1 and 2 cent coins were removed from circulation. The method adopted by the Reserve Bank of New Zealand for rounding was one based on a system commonly used in Sweden, following the removal of 1 and 2 öre coins from circulation in 1972. The Reserve Bank of Australia followed New Zealand's lead, and usage of the term, when 1 and 2 cent coins were removed from circulation in Australia in 1993. The method is not used in Sweden after 1985, when the 5 and 25 öre coins were cancelled.
