Time to empty out the piggy banks to help small businesses. Missouri banks are asking consumers to deposit their spare change at their local banks or use change when shopping as the pandemic-related shutdowns have created a slowdown in coin circulation.
When COVID-19 restrictions went into place, establishments like retail shops, bank branches, and laundromats — the typical places where coins enter society — closed, it significantly slowed the normal rate of coin circulation. Consumers then migrated to shopping online or, if in person, using debit and credit cards to avoid physical contact associated with using cash. The coins they would have received in change were then not being circulated back into the system.
“In the beginning of 2020, more than 4 billion coins were deposited — or recirculated — each month,” said Max Cook, president, and CEO of the Missouri Bankers Association. “Those numbers dropped to less than 2 billion beginning in April.”
As businesses are reopening, demand from merchants to stock their coins at higher levels is increasing, but many coins remain with consumers. This is creating a critical issue because recirculated coins represent more than 80% of the supply, with the remaining amount being new coins produced by the U.S. Mint.
“There is an adequate amount of coins in the economy, but the slowed pace of circulation means that a sufficient amount of coins is not readily available where needed,” Cook said. “If you have spare change, we encourage you to check with your local banks to see if they are accepting coins or use exact amounts when purchasing items.”
As of April 2020, the U.S. Treasury estimates that the total value of coins in circulation is $47.8 billion, up from $47.4 billion as of April 2019.
The Federal Reserve projects the gap between supply and demand between 2.3 to 3.5 billion coins each month through the end of 2020.