House Republicans asked the Federal Reserve to take a thoughtful approach to its role in recirculating pennies.
Details: In a letter to Fed Chairman Jerome Powell, the lawmakers:
-
Expressed support for the administration’s decision to halt penny production due to its high cost to taxpayers, but emphasized the need for clear legislative guidance to ensure fair and consistent cash practices.
-
Said clear rounding guidance will enable retailers and banks to implement rounding practices consistently, protect against potential legal or regulatory risks, and ensure consumer confidence.
-
Said they are particularly concerned that the prohibition on penny deposits at most coin terminal locations is unnecessarily preventing pennies from re-entering circulation.
ICBA Article: A recent ICBA article spotlights how community bankers are responding to the federal government officially discontinuing production of new pennies.
Background: President Donald Trump in February called for an end to minting pennies given the cost, though there has not been any formal announcement from the Treasury Department. The U.S. Mint last month struck the final circulating one-cent coin, marking the official end of the penny’s 232-year production run.
Federal Reserve Resources:
-
A recent blog post from the Federal Reserve Bank of Atlanta examines possible rounding methods the United States could use when penny production is phased out.
-
The Federal Reserve Board previously released frequently asked questions on anticipated changes to penny ordering and deposits following the Treasury Department decision to end penny production.
Additional ICBA Resources:
-
A recent ICBA blog post breaks down recent developments and ICBA’s efforts to gain clarity and address disruptions stemming from the end of penny production.
-
The ICBA Compliance Center Question of the Week page features Q&As on Treasury’s decision to end production of the penny.
-
ICBA Community also features community banker discussions on processes and best practices related to the penny going away.