Penny Shortages Are Having An Unexpected Effect On Banks And Businesses

The U.S. penny has been on a roller coaster ride over the past few years, in large part because the penny costs more to make than it's worth. The whiplash accelerated when the United States Mint — in their 2024 Annual Report — disclosed that each penny cost .0369 to make, approaching four times its face value. This made President Trump determined to get rid of this coin, and in February 2025, Trump instructed the Mint to stop producing the penny. Then, in May, the Treasury Department confirmed that they'd ordered their last penny blanks. Starting in August, and continuing through the fall, the Federal Reserve has been reporting where they are stopping the fulfillment of penny orders. As of November 3, 2025, almost 100 Federal Reserve Bank distribution sites can no longer obtain the humble penny. 

However, despite the rollout, merchants and banks are struggling to have enough pennies on hand in order to make change for customers. Per the National Retail Federation, retailers have been rounding down their cash transactions to the nearest nickel — favoring customers — in order to avoid any potential complaints and/or lawsuits. However, this is costing them, perhaps big time. One retailer told AP News that this decision will collectively cost merchants — just this year – millions of dollars. 

The penny comes with nostalgic value, being the first coin minted after the newly formed United States achieved liberty. However, according to a Treasury spokesperson, eliminating the penny is meant to save $56 million annually in material costs. Although that helps to make a good case for halting production — and although the U.S. is not the first country to quit small-value coins — it's worth noting that the other countries that did so did it gradually rather than all at once. Canada, for example, announced a gradual stoppage of its penny in 2012, and its government provided specific guidance on how to transition. Although the United States has a bill pending in Congress — called the Common Cents Act — that would help retailers navigate the process, there has been no progress thanks in large part to a general political stalemate, and the subsequent government shutdown.

Retailers are therefore having to devise their own solutions. Grocery store chain Giant Eagle, for example, creatively collected more than 100 million pennies from customers during a Penny Exchange Day held across 200 stores. In return, customers received store gift cards for twice the number of pennies they brought in. Considering how Americans spend an average of nearly $1,000 apiece during the holidays at grocery stores, retail shops, and more, the penny shortage dilemma is soon to become even more acute. Plus, as of early November 2025, Congress is still shut down, so relief is not on the way through legislation.