HUNTSVILLE, Ala. (WHNT) — If you’ve frequented local drive thru’s lately, you might be accustomed to hearing “we’re not taking cash,” or “cards only” through the loudspeaker.
Some of your favorite restaurants and grocery chains have also posted signs acknowledging a coin shortage, but the Alabama Bankers Association said that’s not fully accurate.
“When COVID-19 restrictions went into place, we changed our day-to-day behavior that resulted in far fewer coins being used either when we’re spending money or in making change,” explained Scott Latham, CEO and President of the ABA.
The executive said the pandemic is causing many people to keep their coins in their pockets, which causes a slow down in the coin’s lifespan.
Coins are created by the U.S. Mint and then distributed by the Federal Reserve to banks. The banks then provide the coins to merchants or businesses.
Many consumers have opted for contactless payment options like cards and mobile apps, resulting in a decline of withdrawals or deposits by merchants at banks.
The coins still exist, they’re just not seeing much movement at the moment.
“We certainly call it a circulation issue,” Latham explained. “It’s almost a supply and demand, sort of thing.”
He said a company’s corporate office might mandate many of the signs posted. Latham believes as more people venture outside again and resume normal activities, coin circulation will improve and many of those signs will come down.
The ABA said because there’s an uptick in consumers using credit and debit cards, the organization encourages closely monitoring bank activity. The threats of identity theft and fraud have seemingly increased during the pandemic.
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