The coin shortage that resulted from the COVID-19 pandemic is ongoing, making it more difficult for banks and credit unions to supply business customers with the coin they need to transact with cash-preferred consumers—and on the flip side, with less change to go around, cash-preferred consumers oftentimes have to navigate the inconvenience of using exact change or paying electronically.
While it’s true that much of the population is showing a stronger preference for digital payment and banking channels since 2020, businesses and banks still rely on coin in everyday operations. And the coin shortage doesn’t mean there’s less of it to go around—on average, U.S. households have $113 worth lying around in between couch cushions and in piggy banks.
How can your bank or credit union get coin moving? In this article, we’ll discuss the current state of coin, how you can help get coin moving, and the surprising ways that creating a healthy, circular coin ecosystem can create better results for your bottom line and for the environment.
The Current State of Coin
Right now there is $15 billion worth of coin in circulation and over half of it ($7.7 billion) is sitting untouched in U.S. homes. With so much coin around, why is there a shortage?
It may be too soon to tell, but COVID-19 has likely fundamentally changed the way that people shop and bank. During the peak of the pandemic, business and bank closures caused a disruption in the normal circulation of coin. With fewer transactions occurring, fewer coins were changing hands as many people opted to shop online or hold onto their coins instead of depositing them. However, even with the lack of circulation of coins, there are still many people who transact with cash and coins.
According to Federal Reserve data, 19% of the population is unbanked or underbanked, and while the statistic varies according to the source, NACS states that those who are underbanked “rely on cash and coins to make purchases and pay their bills. Without cash and coin in circulation, it’s harder for underbanked families to buy basic necessities, other goods and services, and to fully participate in the economy.” With a quarter of the population relying on physical cash and coins, it is crucial to encourage coin circulation and provide them with banking services they can benefit from.
Get Coin Moving
October was officially named “Get Coin Moving” month, with the goal of the U.S. Coin Task Force to encourage citizens to get their coins back in circulation by either spending them or depositing them at coin kiosks or banks. By getting coins back into circulation, you can fulfill coin needs for your small business customers, allowing them to deliver better consumer experiences and avoid lost revenue. Another benefit is that recycling coin lowers your carbon footprint by requiring fewer net new coins to be minted.
How Improving Coin Circulation Can Improve Your Institution
While coin may seem insignificant, there are $7.7 billion worth in coin just waiting to be utilized. With Coinstar for Financial’s new program, Retail Remote Deposit, customers can deposit coins into their checking account from any participating Coinstar kiosk, allowing them to easily convert their coins into spendable funds. Customers can now interact with your institution across major retailers nationwide, and with 92% of Americans living within 5 miles of a Coinstar kiosk, you are able to serve banking deserts better than ever before. So, what about the benefits for your institution? There are four key advantages to coin circulation:
- Providing your customers an easy way to transact with your institution while converting their coin into spendable funds boosts customer convenience and inspires customer loyalty.
- You can expand your services without having to physically expand your locations.
- You give your customers a simple way to deposit their coins, increasing deposits within your organization and keeping your teams focused on cross-selling and higher-value interactions.
- Recycling coin reduces your institution’s carbon footprint, contributing to your sustainability goals and positively impacting your ESG results.
Coin’s Hidden Potential Revealed
With so many coins lying around American households, it’s about time we get them back into circulation in order to make life easier for both customers and make servicing customers easier for institutions. With Retail Remote Deposit, not only are you working to alleviate the coin shortage, but your institution expands your services, drives deposits to activate latent coin, and inspires customer loyalty. Explore Retail Remote Deposit by Coinstar and follow us on LinkedIn to stay up to date on the latest in coin management.