National Coin Shortage: Where are the coins and how can I help?
National news and signs at local businesses about a coin shortage may have you wondering what has happened to the U.S. inventory of coins. In a June 30th news release, the Federal Reserve stated that as of April 2020, the U.S. Treasury estimated the total value of coins in circulation was $47.8 billion. This is up $400 million from the same time last year. That begs the question, “What is the cause of the coin shortage?” Simply put, the shortage is resulting from a lack of circulation.
To help slow the spread of COVID-19, the government called for a partial economic closure in late March. The halt in economic activity in March, and subsequent economic slowdown that followed, resulted in less coins circulating. According to a July 22nd USA Today news report, Federal Reserve chairman Jerome Powell confirmed that the coin shortage resulted from the partial closure. “With the partial closure of the economy, the flow of funds through the economy has stopped,” he said. “We are working with the Mint and Reserve Banks, and as the economy re-opens, we are starting to see money move around again”.
While many businesses have reopened, circulation is still low. Below are some contributing factors:
- Limited social interaction – people staying home to avoid contracting the virus or infecting others – means there are less people transacting.
- People are opting for the type of payments that require less contact including:
- Using their debit or credit cards
- Contactless payment services such as Apple Pay®, Samsung Pay®, or Google Pay™.
Both the U.S. Mint (the nation’s coin manufacturer) and the Federal Reserve are doing everything they can to ensure that coin production is up and distributed fairly across the nation. However, new coin is not the only solution to this national problem. On June 25th, the New York Times quoted Michael White, spokesman for the Mint, “The coin shortage has been mainly caused by coins not re-entering distribution” .
While there is plenty of coin available, it just isn’t currently circulating at a normal rate. Coins are sitting stagnant in the many places we keep it – in a purse or pocket, in a jar or piggy bank at home, in the car, underneath a sofa cushion – basically wherever coin goes to hide. You can help get coin back into circulation by redeeming your stored coin for cash or deposit. Kleberg Bank is prepared to pay you 3% for the total amount of coin you redeem. Make an appointment today to redeem your coin.