The answer is, no, the US is not really running out of coins. There is approximately $48 billion in coin in circulation. However, most of which is sitting dormant inside America's 128 million households.
The Federal Reserve, the Central bank of the US says it is not a national coin shortage but a dramatic deceleration of coin circulation. To address the circulation problem, the United States Mint and Federal Reserve established a U.S. Coin Task Force in July 2020 that are critical parts of the coin supply chain such as:
As we move towards contactless and digital payments and coin-intensive businesses like laundromats, transits, retail locations remain shut following the guidelines by the public health authorities. Most of the coins are stored in piggy banks, change jars, car cup holders, and shut businesses.
If just a fraction of the coin sitting dormant in households is brought back into circulation, the problem of coin shortage: can be solved. In view of this, the Federal Reserve has urged for a collective effort from the coin industry partners and the public, to promote the circulation of coin using the hashtag #getcoinmoving on social media.
U.S. Coin Task Force urges the American public to:
If you are wondering why don't people just use credit or debit cards instead? What about other payment methods like digital wallets?
That is because there is a large unbanked population in the US. Approximately 6% of U.S. adults are unbanked, according to a 2019 report by the Federal Reserve. An additional 16% were underbanked, meaning they had an account at a bank but used alternative services, such as money orders for money transfer and check cashing services.
States in the deep South have the highest rate of unbanked population in the United States. The unbanked rate in Mississippi is nearly 16%, which is more than double the national average. Grocery stores, convenience stores, and supermarkets such as Walmart are trying to bridge the gap by offering financial services.
In the early days of lockdown in the US, we had seen a spike in search of Walmart Money Centre on Google, especially in the Southern States. It is no coincidence that the Southern States recorded breakouts in interest on "Walmart send money" during this pandemic, as you can see in the data from Google Trends.
Consumers use supermarkets like Walmart to send money even though money transfer specialists like Xoom, Wise, formerly known as TransferWise, and Remitly offer better deals. Always compare top money transfer companies online before sending money internationally.
Also read: How to open a bank account with an address proof in the U.S.
In conclusion, the coin circulation issue is yet another unlikely consequence of this pandemic but it is likely to be solved sooner than later as the U.S. Coin Task Force identifies and implements actions to #getcoinmoving. Make sure you are following the Centers for Disease Control and Prevention (CDC) guidelines for your health and safety when you are using any public spaces such as retail stores, banks, grocery stores to redeem your coins.
Download Our Free App
Try our faster, enhanced mobile app for a better experience