Letter Requesting the Federal Reserve to Maintain Full Penny Deposit Services

On behalf of the American Bankers Association, we write to respectfully but urgently request that the Administration take coordinated steps to smooth the operational challenges associated with the decision to discontinue minting the penny, including by educating the public, giving guidance on rounding transactions, and ensuring the existing penny supply continue to circulate during the transition.

All stakeholders, including banks, retailers, and consumers would benefit from a coordinated federal response to this situation. We ask that Treasury and the Federal Reserve formulate a plan to manage penny circulation to meet current demand and to reduce future demand in recognition that no more pennies will be minted. The federal government response should be communicated nationwide to the industry and the public to maximize awareness of the issue.

As a first step, the Federal Reserve should take immediate action to continue accepting penny deposits at all coin terminals nationwide while more long-term actions are undertaken to manage circulation of the coin. This includes those locations operated by the Federal Reserve and those that are operated by the private sector on their behalf. Any terminals that have already been closed for penny transactions should be re-opened immediately. This new policy was enacted in August and has already resulted in more than 70-coin terminal locations being closed out of the 165 operating across the country.

The new policy states that when a coin terminal runs low on penny inventory it will cease accepting orders for pennies and stop accepting pennies for deposit. We understand that locations without pennies will be unable to fulfill orders for the coin, but if they do not accept penny deposits, they preclude the opportunity to ever have enough pennies for distribution.

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