For months, unexpected shortages have cropped up across the country as a result of the coronavirus pandemic: toilet paper, hand sanitizer, antibacterial wipes, beef and poultry – and now coins.
Nickels and dimes, quarters and pennies have become increasingly scarce during COVID-19, and according to local banking officials, there are several underlying reasons.
Justin Foster, vice president of Community First National Bank of Kerrville, said it’s no conspiracy theory, as some have suggested; it’s just common sense.
The United States Mint, like many other businesses nationwide, has employed social distancing guidelines which led to fewer workers present at any given time. As a result, the mint has been producing fewer coins than usual.
“But really, the biggest cause is … that people are not going to places like laundromats and carwashes, or using vending machines, because people are staying home – those coins are just not there,” Foster said. “It’s really pretty simple. There’s just less circulation.”
The good news is that the Fed plans to assemble a U.S. Coin Task Force to ramp up production.
The bad news is that, for the time being, the inconvenience is here to stay.
Foster noted that many corporations and national chains, such as Walmart and CVS, are issuing mandates to designate certain registers as plastic-only. Other aisles may be requiring customers to use exact change.
Some small businesses have been forced to forego cash sales outright – an emerging problem for those who do not have bank accounts or have no other alternative.
“That’s the practical effect,” Foster said. “Until businesses open normally again, we’ll probably see this for a little while.”
Even before the pandemic, he noted, many weren’t carrying cash, choosing to rely instead on credit or debit cards or Apple Pay.
“When you take increased technology and ease of payment, and add on top of it COVID-19, the result is less cash, fewer coins,” Foster said.
But, he said, as things open up and people begin leaving the house more, cash and coinage will begin to circulate more freely again.
“It’s very simple to fix,” Foster said. “Just get more coins back into circulation.”
In the meantime, banks across the country are attempting to help alleviate the strain by requesting that customers bring in their change if possible.
“If you’re wanting to help, we all probably have a change jar,” Foster said.
Roy Thompson, President and CEO of Texas Hill Country Bank, noted this is the first time in his banking career he’s seen a coin shortage of this nature, and he finds it fascinating – if inconvenient.
“It’s been crazy,” he said. “It’s because economic activity has slowed down, and more people are using a debit or credit card to swipe rather than having to handle cash back and forth.”
Thompson noted that it’s caused a problem for local businesses that deal in cash, because getting enough coins to make change for customers has become difficult.
Realistically, Thompson said, the best temporary solution is for customers to bring in their spare change. At Texas Hill Country Bank, he noted, they’ve asked employees to do the same.
“That’s really the remedy right now,” he said. “Everyone’s doing what they have to make sure we can help out our customers.”
But, he added, a long-term solution will take some time.
“It will take the economy going back to full employment, and people getting out and working and spending money again, and spending cash again,” Thompson said.