A penny saved has always been a penny earned. But now they’re more like collector’s items.
The penny shortage that began this summer is only poised to get worse heading into the holiday season as the U.S. Mint produced the last copper coin Nov. 12 after 232 years.
Around South Carolina, businesses are trying to handle the phase-out that came with no government guidance on how to handle transactions.
Some store owners are rounding up, some are requiring exact change as cash still makes up 14 percent of all U.S. sales, according to 2024 data from the U.S. Federal Reserve. Luckily for many, plastic is king with customers these days.
Keith Benjamin, who operates five dining and drinking establishments in the Charleston area, said 95 percent of his restaurant and bar business is electronic transactions. For the few customers who need change, he’s been rounding up for some time in their favor.
“When a guest pays with cash, we tender change with quarters,” he said. “And just round up for the guest.”
A patron due $8.35 in change, for example, would typically receive $8.50 instead, he said. The till difference at the end of the night “comes out in the wash,” Benjamin said.
Tom Caufmann, who runs Broad Street Café in downtown Charleston, said he too averages high card sales, with about 90 percent digital transactions and 10 percent cash.
He’s rolled with the penny shortage for a while as well. “I tend to round up when we don’t have (pennies) on hand,” he said.
Back when it was introduced in 1793, the penny bought significance. You could buy a biscuit, a candle or a piece of candy. Now most of the coins are cast aside to sit in jars or junk drawers and costs four cents to make.
The estimated 250 billion pennies in circulation remain legal tender and variety stores like Big T’s on Ashley River Road are still operating as normal with pennies given and pennies taken. For the time being, anyway.
For retailers, the phase-out has been abrupt, and in part significant given that price tags ending in $.99 are a bedrock of American retail used to convince customers of a good deal. Stores like Food Lion have been left pleading for Americans to pay in exact change.
“We have been advocating abolition of the penny for 30 years. But this is not the way we wanted it to go,” Jeff Lenard with the National Association of Convenience Stores told the Associated Press.
“We don’t want the penny back. We just want some sort of clarity from the federal government on what to do, as this issue is only going to get worse,” the NACS’ Lenard said.
The American Bankers Association says that some banks and retailers may round cash transactions to the nearest five cents, mimicking what countries like Canada and Australia did after phasing out their own lowest-value coins.
Big chains around the U.S. have been establishing their change rules following the final mint.
Harris Teeter stores are rounding to the nearest five cents, a spokesperson for the grocery store said in a statement.
“When rounding occurs, we will reduce the amount owed to us, meaning the rounding will always favor the customer,” the spokesperson said. “As a result, customers may receive more in change than the exact amount owed. Card and digital payments are not affected. All rounding adjustments will be clearly shown on receipts.”
In Spartanburg, a QuikTrip convenience store warned of potential shortages ahead. Unlike Harris Teeter, QT is noting in signs at registers, “Cash transactions may be rounded down to the nearest nickel.”
At the source, banks are no longer able to order fresh pennies and are rationing them for their customers, the American Bankers Association said.
“Banks will continue to accept and process pennies as long as they remain in circulation and will keep customers informed of any changes,” the association said. It too noted customers could see rounding in cash transactions or encouragement to use electronic payments.
The U.S. Mint issued 3.23 billion pennies in 2024, the last full year of production, more than double that of the second-most minted coin in the country: the quarter. But the problem with pennies is they are issued, given as change, and rarely recirculated back into the economy. This requires the Mint to produce significant sums of pennies each year.
The government is expected to save $56 million by not minting pennies, according to the Treasury Department. Despite losing money on the penny, the Mint is profitable for the U.S. government through its production of other circulating coins as well as coin proof and commemorative sets that appeal to numismatic collectors.
Associated Press contributed to this story.
SC businesses navigate US penny shortage with own rules
