Among other disruptions to daily life caused by the coronavirus (COVID-19), you can now add a lack of coins to make change. When stores can’t give a cash customer the exact change back because of a lack of pennies, they’re rounding it up and giving back more than required.
At East Coast convenience store chain WaWa, customers paying with cash are given the option of rounding up their purchase to the nearest dollar and donating the change to the WaWa Foundation.
How did the pandemic create a shortage of pennies, nickels, dimes, and quarters? The Federal Reserve points to a number of different factors.
Fed task force
When retail stores and restaurants shut down for several weeks in March and April, it caused a disruption in the normal supply chain of coins. Physical money didn’t circulate like it normally does. According to the American Bankers Association (ABA), the Fed has established a task force to look for solutions.
“The Federal Reserve is working on many fronts with our industry partners, including the U.S. Mint, to minimize supply constraints and maximize coin production capacity,” the Fed noted recently. “We are encouraging depository institutions to order only the coin they need to meet near-term customer demand and to remove barriers to customer coin deposits.”
The government has also been producing fewer coins lately. One U.S. Mint facility closed for a time during the shutdown. Other facilities are operating with fewer employees due to social distancing requirements.
Consumers to the rescue
Consumers have also spent less money since the pandemic hit. That jar of loose change on the bedroom dresser has remained full and mostly untouched since March, but businesses say they could really use it now. Banks are also desperate to get their hands on coins, and they say some consumers are helping.
“We have people coming in about every 15 minutes which we are so thankful for,” Sarah Engels, operations manager at Amarillo National Bank told a local TV station. “We do provide coin to a lot of businesses in the Panhandle so we are just so grateful.”
Consumers can help by always carrying ample pocket change when making cash purchases so they can pay with exact change. Using a credit or debit card eliminates the need for a merchant to make change, but it does nothing to put much-needed coins back into circulation.
The Fed says the issue will be resolved once the economy has fully reopened, but no one can say when that will be. The central bank acknowledges that until that happens, the coin shortage may persist.