Personal Finance & Money Asked on July 31, 2021
I’ve been noticing lately that a lot of restaurants and retail stores in the US have signs on the registers saying there is some kind of shortage of coins right now and they are limited in how much change they can make.
What’s going on to cause this? Is it related to COVID somehow?
According to this article in Forbes, the problem is not really a lack of coins, but mainly a slow-down in retail transactions.
One particular issue is the reduction in business at places that have a major role in collecting coins from consumers and returning them to the banks,
[Columbia business school assistant professor Yiming] Ma says businesses that primarily take coins, such as laundromats, vending machines and car washes, likely stopped operating during the pandemic due to social distancing and stay-at-home measures. These businesses are usually key components in getting coins back to banks to redistribute back into the economy. Since they weren’t receiving coins, the flow of them back into the economy has been significantly reduced.
Correct answer by The Photon on July 31, 2021
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