Obsolete bills to lose legal tender status

The federal government is planning to eliminate “legal tender” status for certain obsolete bank notes — including the $1, $2, $25, $500 and $1,000 bills — that are no longer being produced.

The change means these notes won’t be acceptable for use in transactions after Jan. 1, 2021, although they will be redeemable at face value at financial institutions.

The issue of $1 and $2 bills ended in 1989 and 1996, respectively, after these bills were replaced with coins.

The $25 and $500 bills were discontinued shortly after they were issued in 1935, and the $1,000 note was scrapped in 2000.

“Most Canadians will not be affected because the bank notes targeted by this announcement have not been produced in decades and are rarely used in transactions,” the Bank of Canada states.

The central bank indicates that it supports the move, “which helps ensure that the bank notes used by Canadians are current, in good condition, easy to use and difficult to counterfeit.”

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.