Due to COVID-19 and related business closures (disrupting circulation patterns), the United States has seen a coin shortage emerge over the past few months.
“People have not been out as much. They’re not even going and giving change to a grocery store, a restaurant or anything like that. That just limits the amount of change that’s in the system. You couple that with the stores that had to close and even if they aren’t a big user of coin, if they’re any sort of retail they’re going to have some coin,” said Jane Deterding, chairman of Citizens Bank of Kansas. “So, the ones that have closed, that coin could be sitting there and just not being circulated.”
While the U.S. Mint has returned to operating at full production since mid-June, the Federal Reserve has maintained a cap on coin orders in the ensuing month to fight the shortage. That is something Deterding noted CBK is cognitive of, though that cap was increased as of July 20.
Noting that CBK has not had to request its max coin order, Deterding said the bank is in good shape despite the national shortage – which she does not see as a serious risk to business locally.
“There’s probably more concern about it than is actually warranted,” Deterding said. “When the (Federal Reserve) kicked out the notice, it created some hubbub. It created a little more drama than I think is there.”
Carson Bank President and CEO Frank Carson IV noted the Mulvane depository has seen minimal impact as well.
Availability of coins may be limited and access to coins is restricted to bank customers at this time, but Carson noted the bank remains able to provide.
“We have not been really in a position where a customer hasn’t been able to get what they need necessarily,” Carson said.
Even the bank clients that have been most impacted by the coin shortage – small businesses like gas stations, mom and pop restaurants, etc. – have been able to get the change they need for customers paying cash on low dollar items.
For the moment, the Federal Reserve has stated that the coin shortage issue persists – with no end in sight currently.
On the bright side, Deterding said awareness of the issue has led to more customers bringing in their own coins to be converted to cash (at no charge) – a benefit to local banks. Though Carson is not concerned about the coin shortage at present, he also noted that an increase to local circulation helps.
“Unless you’re reliant on coin, it’s really not going to have a major impact on most customers for banks. However, my two cents would be if you do have coin bring it in to your bank – whether it’s us or any other bank in the area, bring it in,” Carson said. “That certainly helps because we can roll it and we can get it to the people who need it.”