WSAZ Investigates | Making ‘sense’ of a nationwide coin shortage
PORTSMOUTH, Ohio (WSAZ) - We’re already starting to see signs pop up at businesses around the Tri-State announcing “exact change only.”
These are another unforeseen complication from the COVID-19 pandemic. During many stay at home orders, few people were spending the change in their wallet.
The federal government says the coins are out there, but due to coronavirus closing many businesses, they’re not circulating like banks and businesses need them to.
“We’re having to turn coin collectors away because we’ve got businesses that need that coin more right now,” said Lee Powell, president and CEO of Desco Federal Credit Union in Portsmouth.
Check your piggy banks, check your wallets, because the coins you’ve been toting around are now in high demand.
“The coins are out there,” said Powell. “But they’re in people’s ashtrays and sofas and they’re just not being recirculated.”
Powell says thanks to shutdowns associated with COVID-19, change normally flowing through businesses is drying up.
“Several businesses that dealt in coin were either not open or offering limited hours and an interesting comment was laundromats,” Powell said.
The shortage is so severe, according to Powell, that banks are only receiving a portion of the change they typically order from the Federal Reserve. This means those same banks are limited in what they can give businesses and you.
The effects of the shortage don’t stop there. Signs are being posted in Barboursville and South Charleston, requesting patrons who are paying with cash to use exact change.
Next time you go to the store, if you don’t use a card or produce exact change, you might have to round up.
In a letter to financial institutions, the Federal Reserve says the supply problem is temporary. When banks were first closed due to COVID-19, the U.S. Mint, which makes American currency, slowed production.
“Typically people deposit coins over the teller counter at financial institutions,” Powell said. “If you try to put them in a tube at a drive up, they’re either too heavy to go through the tube system or, worst case scenario, it goes halfway through the tube system and it gets stuck, and we have to shut down a lane and fish the thing out.”
Many businesses and consumers say they’re seeing more plastic being used to pay for goods, just another reason fewer coins are being passed around.
“I’m a card person. When I do buy, it’s usually with bills, I very rarely use change.”
Debbie works at a local bakery and says they use quarters the most.
The Federal Reserve issued a statement to banks that indicates that coin allocations to banks, credit unions and other depository institutions will be reduced by 40 percent for the time being.
As bank lobbies being to reopen, they’re encouraging customers to exchange their coins for cash.
If you’re out shopping, try spending some of that loose coin weighing down your wallet.
“You’re not going to earn much interest in this environment but at least you’ll earn a few pennies and you’ll be helping out your fellow consumers and businesses,” Powell said.
The Federal Reserve says they are now gathering together industry leaders and creating a limited time U.S. Coin Task Force. They say the group will identify, implement, and promote actions to help limit disruptions to normal coin circulation.
In the meantime, Powell says his credit unions have stopped selling back coin to the Federal Reserve, in order to keep the change in customers’ hands.
“Anything we get in we’ve kept and we’ve made sure we’ve allocated that specifically for those member businesses,” Powell said.
It’s a change you can bank on, at least for now.
For the time being, a penny for your thoughts may be harder to come by.
Copyright 2020 WSAZ. All rights reserved.