How the growing penny shortage may impact you
(NEXSTAR) — A penny shortage was expected, but not for a few more months. Now, businesses have found themselves asking customers not to pay with cash or otherwise prepare to receive incorrect change in return.
Some companies have even asked their customers to exchange pennies for freebies.
With the holiday shopping season ramping up, you may find yourself on the receiving end of these new policies — here’s a look at what to expect.
Why is there a penny shortage?
Earlier this year, President Donald Trump called on the Treasury Department to stop minting new one-cent coins, calling them “wasteful.” A few months later, the Treasury confirmed it would stop putting new pennies into circulation in early 2026, with a spokesperson telling the Wall Street Journal in May that the final order of blanks had been placed.
With no new blanks, the U.S. Mint is unable to produce the one-cent coins.
As of late September, several Federal Reserve coin distribution sites that service retailers and businesses had stopped fulfilling penny orders, taking penny deposits, or both.
It’s worth noting, however, that there are billions of pennies (between 114 billion, estimated in a 1999 report from the Federal Reserve, and 240 billion, according to more recent appraisals) believed to be in circulation.
They aren’t necessarily easily accessible, though. Consider the pennies you have hiding in your couch or in your car’s cupholder. Unless you spend them or exchange them at your bank, they may never see circulation again, which also makes it difficult for distribution sites to pass them around.
Are pennies expensive to make?
Compared to other coins, no, but compared to its own value, yes. The average cost to make one penny rose to 3.69 cents in the last fiscal year, marking the 19th consecutive year the coin has “remained above face value,” per the latest U.S. Mint report. For comparison, it costs less than six cents to make a dime ($0.0576), about 15 cents to make a a quarter ($0.1468), and nearly 34 cents for a half-dollar ($0.3397).
There have been efforts to make the penny cheaper to produce, but using other materials was found to be ineffective.
How are businesses responding to the penny shortage?
Two gas and convenience store chains, Love’s and Kwik Trip, are rounding in favor of the customer. At impacted Love’s locations, cashiers will round change up in favor of the customer (if you’re owed $3.22, you’ll receive $3.25, for example). At Kwik Trip, cashiers are rounding down cash purchases to the nearest five cents (your $6.18 transaction becomes $6.15).
Another convenience store chain, Sheetz, confirmed to Nexstar that some of the company’s stores “may experience limited availability of pennies.” In response, customers are encouraged to use the Sheetz app, mobile app ordering or cashless payment options “whenever possible.” Customers are also able to turn in pennies in exchange for a free self-serve drink or as a donation to Sheetz For the Kidz. A spokesperson noted that donated coins “will then be recirculated for other customers.”
PetSmart confirmed its customers are being given a similar opportunity. When a customer opts to round their transaction up to the nearest dollar, the extra change is donated to PetSmart Charities.
A Burger King spokesperson, meanwhile, said while its U.S. restaurants are still accepting pennies, “exact change may not be possible” due to the shortage.
Will the price of goods be rounded, too?
It seems unlikely. As Dylan Jeon, National Retail Federation senior director of government relations, explained to Nexstar, changing the price of everything to eliminate the need for pennies “would end up being more complicated” than rounding transactions.
There are two main reasons: the physical work required to reprice everything and having to account for sales tax.
Jeon acknowledged that getting rid of the penny in the U.S. is more complicated than when Canada did it roughly 10 years ago, mimicking that their practice of rounding the transaction, post-sales tax or the change is “the easiest, most standard practice here.”
Rounding may face legal challenges
Penny shortages were expected in mid-to-late 2026 but have, of course, set in sooner, leaving everyone — state and federal governments, as well as businesses — “scrambling…to put together policies on how to handle cash transactions without pennies,” Jeon said.
In at least 10 states and localities, cash laws prohibit businesses from rounding cash transactions up or down, the National Association of Convenience Stores said in a letter to the Senate Banking and House Financial Services Committees late last month. The group further called on lawmakers to establish a national law to allow rounding.
A bill to do that was introduced by Rep. Lisa McClain (R-Mich.) in April. The House Committee on Financial Services recommended that an amended version of the bill be passed. It has since been placed on the calendar. However, amidst the government shutdown, it’s difficult to say when the bill could reach the House floor, if at all.
Part of the problem, Jeon explained, relates to laws that say those paying with a different form of tender, like a SNAP EBT card, can’t be charged differently than a customer paying with cash. He said the other consideration is also on cash checking, a practice that grocery stores are frequently tasked with, as there is no clear guidance on rounding these exchanges.
Jeon noted that the NRF is working with the U.S. Department of Agriculture, which oversees SNAP benefits, and Congress, calling for guidance for businesses who find themselves with little to no penny supply.
Paying with cash? What to expect
For now, if you’re planning to pay with cash at a store or restaurant, you may want to prepare to receive slightly more change than you’re actually owed.
Jeon urged customers to “be understanding of this new reality that we’re heading into.” He noted that retailers are “master planners and master operators” that may already have a plan in place to address the penny shortage.
Nonetheless, pennies remain legal tender, so you will likely still be able to use them to pay at the register. There’s likely little value in stockpiling pennies and hoping for a big payout, however.