Banks are begging for spare change: How long coin shortage could last

In the midst of a nationwide coin shortage, some retailers are asking for customers to use exact change, if possible, or even better, use a credit or debit card for payment.

Banks are begging you to break open your piggy bank, dig through your seat cushions and unload those coffee cans full of change sitting in the closet.

The COVID-19 change shortage has bankers all across the country asking customers to bring in rolled coins as a way to pump more pennies, nickels, dimes and quarters into circulation.

A Wisconsin bank went so far in July as to offer an extra $5 for every $100 in coins that are brought into the Community State Bank, whose main office is in Union Grove.

The deal turned out to be incredibly popular and lasted but seven days, ending at the close of business July 21.

“People brought stuff in cans, bags and jars,” said Greg Wall, chief innovation officer for Community State Bank, which has $460 million in assets and 7 branches in southeastern Wisconsin.

“People have been sitting on this stuff for a long time and they finally had an opportunity to do something,” Wall said.

One person brought in $4,000 in coins — netting a $200 bonus.

“At this point, we’re going to pause the program,” Wall said, noting that the goal of building up coin inventory for local businesses was met and then some.

It’s quite a switch from a time when many banks didn’t want your spare change.

In the past few years, many big banks phased out services that would count your coins for you. Some, like Community State Bank, charge a 10% fee or so for non-customers to count their change. Other banks charge both customers and non-customers to count their coins.

Banks want you to roll up coins in paper wrappers yourself. Some banks might limit the dollar value of coins they’re willing to take.

But a lot has changed during the pandemic.

Quite simply, we’re not throwing around our money like we used to ever since mid-March when huge chunks of the U.S. economy shut down in an effort to reduce the spread of the coronavirus.

Laundromats, coffee shops, bank branches and other spots where coins regularly changed hands either closed doors or significantly trimmed back operations when COVID-19 limits went into place.

At the same time, the “U.S. Mint’s production of coin also decreased due to measures put in place to protect its employees,” according to the Federal Reserve. Production has been ramped up.

Recirculated coins represent more than 80% of the supply; the rest involves new coins produced by the U.S. Mint.

Even as the economy reopens, change isn’t rattling around the car like it did last summer.

The Ohio Turnpike continues flashing electronic signs that suggest that drivers use E-ZPass or a credit card, not cash, to pay their toll in light of COVID-19.

“We will continue to discourage cash during the pandemic because handling it is riskier than our other methods of payment,” said Brian Newbacher, public information officer for the Ohio Turnpike and Infrastructure Commission.

Currently, he said, the turnpike is able to recycle the coins it receives to other customers who are using cash. But cash usage is down.

Many drivers are responding to those electronic signs. During the month of June, Newbacher said, cash transactions at the toll booths were down 44% compared to last June. And credit transactions were up by 32%.

“If customers are going to use cash we ask that they do their best to provide us exact change, if possible,” he said.

“That way, we can also do our part to not only keep everyone safe, but avoid adding to the coin shortage as well.”

Cash isn’t always king

Some retailers are encouraging the use of plastic, not paper currency, due to fears that currency could spread the disease. So theoretically, the pandemic could help boost cashless, digital transactions.

Even so, some small businesses prefer cash payments and might be hurt by the coin shortage because they want to avoid the extra fees charged to merchants when customers pay with a credit card.

And every shortage comes with its conspiracy theory. Some say it’s a grand plan to put a stop to the private nature of cash transactions.

One Facebook post stated: “Start saving coins, they will soon be worth more as a keepsake or remembrance of ‘the old world.’ The national coin shortage will be just like the great toilet paper shortage — the only difference is, once the coins are gone, they will not be coming back.”

But Patricia Herndon, executive vice president for government relations for the Michigan Bankers Association, said the lack of coin simply reflects spending patterns.

“People are just not really using coins and cash right now,” Herndon said. “This is truly an issue of money flow.”

Some are worried about transmitting germs by using cash. But Herndon said people just need to take precautions, such as washing your hands or using hand sanitizer after exchanging money.

“You’re not the first person to touch it; you’re not the last person to touch it,” she said.

Demand for change picks up

The Fed began rationing coins this summer to deal with the shortage since demand is expected to pick up as businesses reopen.

The Federal Reserve is projecting that we’ll experience a gap between supply and demand that ranges from 2.3 billion to 3.5 billion coins each month through the end of 2020.

Nationwide, more than 4 billion coins were deposited — or recirculated — each month in the beginning of 2020, according to the Michigan Bankers Association.

The numbers plummeted by more than half to essentially less than 2 billion beginning in April.

The Federal Reserve has formed a U.S. Coin Task Force to “identify, implement, and promote actions to address disruptions to coin circulation.”

During the pandemic even when many do go out, they tend to use debit cards or credit cards at the store more frequently because they want to avoid handling cash. My husband has taken to using a McDonald’s gift card at the drive-thru window to limit physical contact when paying for his $1 Diet Coke and my $2 iced coffee.

The change that we would have received — and later spent elsewhere — is no longer a steady part of our daily spending diet.

Retailers craft their own strategies

We’re seeing all sorts of signs at the cash register, as retailers take creative approaches to dealing with the shortage.

Dollar Tree posted signs at the door stating: “Dollar Tree will purchase any rolled coins you want to exchange for cash.”

A few customers have walked in the door with some coins wrapped in rolls to exchange for paper currency. “We’re getting some, not many,” said Daisy Myers, assistant manager at the Dollar Tree in Hazel Park, Mich.

The Dollar Tree, which also owns Family Dollar stores, asks customers to pay by debit or credit card or use exact change to cover a purchase when possible.

Kroger said it can now load coin change onto a customer’s loyalty card so the shopper can use that extra change on the card during the next trip for groceries.

Kroger also asks customers if they want to round up a purchase to an even number to avoid a need for change and support The Kroger Co. Zero Hunger 5/8 Zero Waste Foundation, a public charity.

“Like many retailers and businesses, we are adjusting to the temporary shortage in several ways,” said Rachel Hurst, corporate affairs manager for the Kroger Co. of Michigan.

Kroger is providing coin change at lanes in the store that have coins available, Hurst said.

Self-checkout registers at many retailers may now only allow purchases with plastic cards and no longer offer change.

Spare change can supplement any budget during uncertain economic times, too. Yet some traffic was down at coin counting machines too.

During the pandemic, Coinstar kiosks remained available but foot traffic at supermarkets and other locations was down so fewer people were exchanging coins, according to a statement from Jim Gaherity, CEO of Coinstar.

“As lockdowns end, coin transactions and volumes through Coinstar kiosks are growing and, accordingly, we’ve been making more frequent coin pick-ups to help get coins back in circulation,” Gaherity said.

If your hours are cut at work, it may be a good time to reconsider letting unused coins just sit there. It’s best to avoid any fees, though, if using any coin counting machines.

Coinstar kiosks offer eGift Cards in exchange for coins with no extra fee. Otherwise, you could face an 11.9% service fee to convert the coins to paper; fees may vary by location.

Check online first at to understand the rules. Some gift cards require a minimum amount of change, such as $5 for an Amazon gift card or a minimum of $10 for an Outback Steakhouse eGift card. Again, you may need to count that change first to save the most money.