The Royal Mint has said it has no plans to make new 2p or £2 coins for the next 10 years because there are too many of them already in circulation.

It comes as a new report shows the coins were used in less than three in 10 transactions last year, compared to six in 10 a decade ago.

The National Audit Office (NAO), which carried out the report, said the coronavirus outbreak may have accelerated the trend as customers were encouraged to pay contact-free.

Coin-making has been slashed 65% by The Royal Mint in Llantristant but stocks of every coin in circulation are exceeding its targets. It is now sitting on 26 times more £2 coins than the public need, with excess coins worth around £89million.

A spokeswoman for The Royal Mint said 2p and £2 coin production could return if needed.

However, it said pennies are still in production, with 60million more 1p coins produced this year due to a surge in demand from businesses at the start of the pandemic.

"We constantly monitor the demand for coins from the banks and Post Offices, and seek permission to manufacture more from HM Treasury," a spokeswoman said.

Elsewhere, despite the decline in cash use, a mystery remains over banknotes.

As many as £50billion notes are thought to be missing, according to figures, with the cash thought to be overseas, tucked away in homes unreported or being used in the "shadow economy".