The COVID-19 pandemic is being blamed for most of the nation’s financial woes. But one aspect of the current situation may surprise you.
Federal Reserve Chair Jerome Powell confirms in a USA Today reported article, the virus outbreak is creating a coin shortage.
“With the partial closure of the economy, the flow of funds through the economy has stopped. We are working with the Mint and the Reserve Banks and as the economy re-opens we are starting to see money move around again,” Powell told USA Today.
The Federal Reserve said coin deposits have declined as did the production of coins by the U.S. Mint as it rolled out measures to protect employees.
Also adding to the shortage, businesses encouraging customers to use contactless payments instead of cash to help stop the spread of the virus.
We went straight to the expert to find out more by asking Coinstar CEO Jim Gaherity about the problem.
“I don’t know if I would refer to it as a coin shortage,” Gaherity began. “There are billions of dollars of coins out in America, it’s just not in the right place for use at this point and time, “ he continues.
It’s not fiscally possible to create enough coins to maintain normal circulation across the county. That’s where Coinstar comes in. “The US Mint produces three-and-a-half times less than Coinstar re-circulates in any given year,” Gaherity added. Through their 17,000 plus locations across the nation, Cointstar allows customers to exchange their coins for bills. The change is then sorted, and deposited with financial institutions like the Federal Reserve bank so it can once again jingle in the pockets of consumers.
Find a local Coinstar kiosk near you by clicking here.
Coinstar is owned by Apollo Global Mgmt, now the majority stakeholder in Cox Media Group and KRMG.