One of the most visible and rarely experienced effects that the global pandemic has had on daily lives was the sudden shortage of everyday things.
From empty supermarket stalls to a genuine shortage of toilet papers, Covid-19 showed that we can’t take anything for granted.
Next on the list of things suddenly in shortage are coins in the US – from the pennies to quarters, Banks around America are going through an unprecedented level of coin shortages. The Federal Reserve, which is responsible for the supply of money, is now rationing resources to keep up the coin supply.
One banker from Tennessee said that coins were one of the last things that they expected the pandemic to affect. Yet she said that the Federal Reserve has only supplied her one-fifth of the usual amount of coins after rationing began.
While the shortage of coins do not affect the banks in a dramatic way, it does greatly affect the bank’s business customers. Coins from her bank supplied many vendors around the county – a familiar and natural supply that has suddenly been thwarted because of Covid-19.
While bigger industries and retailers have more or less moved to cashless transactions, much of the smaller purchases in convenient stores or grocery stores are still done via cash. The shortage of change means that those vendors will have to change their method of transaction.
Among larger bank associations and politicians, there is increasing complaint that the banks in the more rural areas are getting less coin than their urban counterparts. If true, it would be unwise as cash transactions are much more frequent in the rural areas.
Rep. John Rose of Tennessee worried that this shortage may cause a massive bank-run situation. He said that once customers start talking amongst themselves about how the bank has no coins to give them, it may easily turn into headlines that read banks are dry of cash.
While it is true that the production of coins decreased, the bigger cause is the bottlenecked distribution of the coins. With many businesses closed and coin-sorting machines in and around banks not operating, coins held by customers could not be circulated.
We will keep up with this issue as the shortage of coin is expected to get more severe. Follow us on Facebook to keep yourself updated on the story.
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