NATIONAL REPORT — The COVID-19 pandemic is to blame for another nationwide supply shortage: coins.
"What's happened is that, with the partial closure of the economy, the flow of coins through the economy has gotten all — it's kind of stopped," Federal Reserve chairman Jerome Powell said.
Rep. John Rose (R-Tenn.) first pointed out the shortage during a virtual hearing with the House Financial Services Committee, noting that many banks in his district weren't given their normal amount of coins and were struggling to help customers and businesses get the coins they needed, reported WKRN.com.
According to Dave Miller, president of First Horizon Bank of East Tennessee, the average bank customer wouldn't notice a coin shortage, but gas stations and convenience stores were the kind of businesses that would.
"You're going to be ordering coins so that you can handle your customers, and we're going to have a hard time getting that coin this week, than we would have, say, pre-pandemic," Miller said.
The executive also noted:
The coin shortage is largely due to the cash flow problem the coronavirus pandemic created when the economy was shut down and consumers started to buy more online.
Although only 20 percent of all purchases were made with cash, 50 percent of purchases under $10 were still made with cash.
Banks for the moment were handling the disruption of coins well, but if the cash flow doesn’t improve, or if more coins aren’t made, then getting change could be a bigger problem in a couple of weeks.
Businesses in East Tennessee experiencing the impact included Powell-based Weigel's, operator of nearly 70 c-stores. The retailer posted flyers on doors asking customers to use exact change because the company is experiencing a coin shortage.
It also stated locations would buy coins from customers.
"We're pretty desperate. We're trying every way possible. We're trying to get change from customers," said Weigel's President Doug Yawberry. "And at some point, we'd be unable to operate, because if you can’t change a dollar, you can’t do business."
However, other Tennessee businesses said they were not noticing an impact from the coin shortage, mainly because the majority of those transactions are electronic, the news outlet reported.
The Pilot Co. said it wasn't impacted yet by the shortage, but the company was monitoring the situation.
"At this time, Pilot Co. is not experiencing a shortage of coins in our travel centers across North America. Based on national trends and indications from the Federal Reserve, we are monitoring and managing the supply of coins in our stores in order to serve guests and continue to provide change when needed. As always, guests also are welcome to pay with credit card, debit card, gift card or exact change when using cash," the travel center operator stated.