The Penny Is Being Phased Out—Here’s What It Means for You
The U.S. Treasury has ended penny production. We’re here to explain what that means for your everyday banking and your business—now and in the future.
The Why
Over the past decade, the cost to produce a single penny has risen significantly—from about 1.3 cents to nearly 3.7 cents per coin. These costs include materials, production facilities, and operational overhead.
With fewer Americans using cash and the penny’s purchasing power continuing to decline, the U.S. Department of the Treasury determined that continued production is no longer fiscally responsible. By suspending penny production, the U.S. Mint projects immediate annual savings of approximately $56 million, with additional savings over time.
Under federal law, the Secretary of the Treasury has the authority to determine coin production levels. That authority is now being used to better steward taxpayer dollars while allowing existing pennies to remain in circulation.
Timeline
February 2025
Direction given to end penny production
November 2025
Final pennies produced, ending more than 230 years of minting
Late 2025 / Early 2026
The Federal Reserve begins suspending penny distribution terminals as supplies run out
The Future
Existing pennies—estimated at more than 100 billion—will continue to circulate for as long as consumers and businesses use them
What This Means for Everyday Banking Customers
Pennies aren’t disappearing overnight. While new pennies are no longer being produced, existing pennies will remain in circulation for the foreseeable future. Most changes will be gradual and primarily affect cash transactions, not digital payments.
- We continue to accept pennies for deposits—bring in your coin jars any time.
- Cash transactions may be rounded. As pennies become less available, some retailers may round the final total of cash purchases to the nearest five cents. Rounding happens only after taxes and fees are calculated.
- To avoid rounding, we recommend carrying coins so you can make exact change.
- Non-cash payments are not affected. Debit cards, credit cards, checks, ACH, online payments, and other digital transactions will continue to settle to the exact cent.
Richwood Bank Specifics:
- Limited penny change orders. Due to reduced supply, we can no longer offer consumer penny change orders and may limit penny availability.
- Rounding for cash when exact change isn’t available. If we don’t have pennies, the change may be deposited into one of your current accounts open with Richwood Bank. Electronic transactions (debit/credit/mobile wallet) remain exact.
Business Customers
As penny availability continues to decline, businesses that handle cash should begin planning for small operational adjustments. While the transition will be gradual, preparing early can help minimize disruption for your staff and customers.
Impact on Banking
Limited Availability: We can no longer guarantee penny rolls for business change orders. Inventory will be managed carefully, and limits may apply. If you order penny rolls or bags, monitor your coin-vault supply. You may need to reduce dependence on large penny orders or shift to other coin denominations/tracking.
Recommended Best Practices
Planning for Cash Rounding
When exact penny change is not available, businesses will need a clear, consistent approach for rounding cash transactions. Common examples include:
- $10.02 → $10.00 (rounded down)
- $10.03 → $10.05 (rounded up)
Electronic transactions—such as debit cards, credit cards, checks, and ACH—should continue to process to the exact cent.
Cash-Handling Implications
You may need to update your point-of-sale and accounting systems to support a rounding approach. You may also need to review pricing displays, and change giving policies to adapt to pennies becoming scarce.
Staff Training & Preparedness
Frontline staff should be trained on how rounding works, when it applies, and how to explain it confidently to customers.
Customer Communication
Proactive communication is key. Let customers know if and when your business will begin rounding cash transactions, how the rounding works, and why the change is happening. Simple signage, receipt messages, or staff talking points can go a long way toward setting expectations and reducing questions or complaints.
Frequently asked questions
Can I still use pennies?
Yes. Pennies remain legal tender and keep their full face value. They can still be used for purchases and deposited at financial institutions.
Are new pennies still being made?
No. The U.S. Mint has stopped producing new pennies. Existing pennies will continue circulating for as long as consumers and businesses use them.
When will pennies completely disappear?
There is no set end date. How long pennies remain in circulation depends largely on consumer behavior and how quickly they are spent or deposited.
Can I cash in pennies at the bank?
Yes—please do. We’ll accept your deposits and encourage you to recirculate coins from home jars.
Can businesses still order pennies from Richwood Bank?
We can no longer guarantee penny rolls for business change orders. Inventory will be managed carefully, and limits may apply.
Can non-business customers order pennies?
Due to reduced supply, we can no longer offer consumer penny change orders.
Does rounding apply to debit cards, credit cards, or checks?
No. Rounding applies only to cash payments. All non-cash transactions continue to settle to the exact cent.
What happens if I cash a check that includes change?
If we don’t have pennies, the change may be deposited into one of your current accounts open with Richwood Bank.
Will my prices change because of rounding?
Overall – No. Rounding applies only to cash transactions and rounds up just as often as it rounds down. Digital payments remain exact.
Where can I get updates or ask questions?
If you have questions about deposits, coin availability, or how the penny phase-out may affect your accounts, please contact your local Richwood Bank team.
