WASHINGTON — Retailers across the United States are sounding alarms as penny shortages intensify, calling for clear federal guidance and swift legislative action to prevent widespread disruption of cash transactions.
The shortages began after the U.S. Treasury ended production of the penny this summer, citing the high cost of minting the coin and inefficiencies in distribution. The Mint struck its final batch in June, and the Federal Reserve made its last shipment to coin distribution sites in August. According to the Retail Industry Leaders Association (RILA), more than 100 of the nation’s 165 coin distribution centers have now run out of pennies.
“The phase-out has moved faster than anyone expected,” said Austen Jensen, senior executive vice president of public affairs at RILA. “Retailers are ready to adapt to a world without the penny, but they cannot do it alone. They need federal agencies and Congress to step up and provide clear, consistent rules for rounding and compliance.”
Retailers Report Widespread Shortages
In a recent RILA survey, 25 of the nation’s largest retailers reported significant coin shortages. Nearly one-quarter said more than 1,000 of their stores are completely out of pennies, while two-thirds have begun rounding transactions to the benefit of customers when pennies are unavailable.
“This is about fairness and consistency,” said one retail executive who participated in the survey. “We are rounding down to make sure customers are not overpaying, but across tens of thousands of transactions, that difference adds up to real money for retailers.”
The National Association of Convenience Stores (NACS) raised similar concerns in September, warning that the lack of guidance could leave retailers caught between state and federal rules. “NACS is concerned that retailers and consumers will be caught in the middle without clear federal guidance,” said Anna Ready Blom, strategic advisor for government relations at NACS. “Many state cash laws do not yet allow rounding, so businesses are uncertain how to proceed.”
Industry Calls for Congressional Action
A coalition of trade groups representing thousands of businesses sent a joint letter to congressional leaders in early October, urging a national rounding standard. The letter, signed by RILA, NACS, the National Retail Federation, FMI – The Food Industry Association, and others, called for a federal law permitting rounding to the nearest nickel and ensuring that such practices do not conflict with SNAP regulations.
“These businesses, large and small, must be able to continue their commitment to their communities in ways that are fair to everyone,” the groups wrote. “Without immediate remedies from the Department of the Treasury, our ability to provide for our customers will be limited.”
Jensen said the issue is not whether the penny should be retired but how the transition is being managed. “Retailers understand the cost savings of ending the penny,” he said. “What they cannot accept is confusion at the register and uncertainty in compliance.”
Retailers Step In to Support Consumers
Some companies are taking creative steps to keep pennies in circulation while awaiting federal action. Pittsburgh-based Giant Eagle hosted a “Penny Exchange Day” on November 1, offering customers gift cards worth twice the value of pennies they turned in.
“Retailers across the country are taking steps to maintain adequate supplies of pennies,” said Giant Eagle president and CEO Bill Artman. “We saw a unique and fun opportunity to reward customers for joining our efforts. We invite everyone to check their change jars, desk drawers, and couch cushions to help keep pennies available for those who choose to pay with cash.”
The Path Forward
Retailers are urging the Treasury Department, the U.S. Department of Agriculture, and Congress to coordinate immediately on a national rounding framework to ensure fairness and uniformity.
