National coin shortage has mixed impacts at local shops

One of the stranger effects of the worldwide COVID-19 pandemic in the United States is a shortage of coins.

The Missouri Bankers Association issued a release Tuesday asking Missouri consumers to deposit change and to use change at the store.

However, effects of the shortage locally vary from business to business.

Kroger has stopped providing direct change to its customers at all of its stores nationwide, including Poplar Bluff.

The company issued a statement on Twitter on July 13 saying it will give customers the option to either add the change to their Kroger Plus Cards for use on subsequent purchases or round transactions up to the next dollar and donate the extra to local food banks.

“The Federal Reserve is experiencing a significant coin shortage that is impacting our store operations and ability to provide change,” the company tweeted. “As a result, the company is implementing a new process for providing change to customers.

“In all staffed lanes, coin change owed to the customer can be applied to your loyalty card and can be used on your next in-store, pickup or delivery purchase. Alternately, we can round your transaction up to the nearest dollar and donate it to your local food bank.”

The coin shortage is a result of fewer people wanting to use coins to purchase goods and services because of the fear of the coins being contaminated with COVID-19, some have said.

The shortage has hit some businesses and banks hard — Community State Bank in Wisconsin recently launched a coin buyback program where it is paying customers a $5 bonus for every $100 of coins they exchange with their bank.

Missouri bankers say the closure of businesses during COVID shutdowns and more online purchasing are causing the shortages.

“In the beginning of 2020, more than four 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 two 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.”

By contrast, some local businesses are not feeling the coin pinch as much.

Jolene Kurz, an assistant manager at the Dollar Tree located at the Eight Points shopping center, said the company still is issuing change, but added the store received only $50 in quarters from its bank on a change run last Thursday, which is $20 less than usual.

“We are still [giving change],” Kurz said on July 16. “We haven’t heard anything else yet.”

Other businesses are feeling the effects of the shortage even less.

Robin Whitaker, a cashier at Harp’s grocery in Dexter, said she has not seen any impact from the coin shortage either.

Two Poplar Bluff businesses — La Boutique and Key Drugs — also report no problems with a coin shortage.

As of April, the U.S. Treasury estimates 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 to be between 2.3 to 3.5 billion coins each month through the end of 2020.