Taos businesses, bank deal with coin shortage

‘We had a really great response from our customers’

Fred Archuleta of El Taoseño Restaurant has heard about a nationwide coin shortage. But so far, it hasn’t affected the business too much.

The restaurant holds onto coin and orders only a little each week from Centinel Bank of Taos. “The bank was able to accommodate us every time,” Archuleta said.

But just to be sure, “We also bought from employees, asked them to bring in their coins.”

Andrew Gonzales, chief operating officer of Río Grande Ace Hardware, in Taos, said the coin shortage hasn’t affected the business much because most of their customers already use plastic for purchases.

But when the Federal Reserve limited how much coin banks could order, “we were impacted immediately,” said Sonya Struck, customer experience manager at Centinel Bank.

It isn’t that the United States was running out of pennies, dimes, nickels and quarters, Struck said. “It was really a circulation issue.”

In April 2020, the U.S. Treasury estimated the total value of coin in circulation is $47.8 billion. But by March fewer people were out spending coins to buy anything as a novel coronavirus pandemic spread. People were urged to stay home by health officials and businesses shut down under public health orders.

Struck, who manages all deposit operations at the main bank and two drive-throughs, knew the cap might be a problem especially for the larger of the 1,700 businesses they work with in the region.

“The bank got a letter from the Federal Reserve at end of June/ early July saying (coin) orders would be limited. That cause a little bit of panic,” she said. But she and Centinel staff jumped on the problem. They called their commercial customers and recommended wording for signs asking people to use exact change. The bank put out a “coin for cash” promotion, encouraging people to bring their penny banks in and exchange for dollar bills, no fee. “That helped us preserve that coin reserve,” Struck said.

“We had a really great response from our customers,” she said.

After the initial scramble, Struck said the bank and customers seem to be holding their own.

“Where we were impacted the most was pennies. That was one we struggled the most with ordering from Federal Reserve. Quarters and dimes not a problem,” she said.

According to the Federal Reserve’s website, “business and bank closures associated with the COVID-19 pandemic have significantly disrupted the supply chain and normal circulation patterns for U.S. coins. While there is an adequate overall amount of coins in the economy, the slowed pace of circulation has reduced available inventories in some areas of the country.”

The Federal Reserve is working with the U.S. Mint and others in the industry on solutions.”

Since mid-June, the U.S. Mint has been operating at full production capacity, minting almost 1.6 billion coins in June and is on track to mint 1.65 billion coins per month for the remainder of the year.

Now that businesses are opening more, Struck said the banks are starting to see circulation increase, both in deposit share and change orders.

Still, “I would say the coin signs will remain until the end of the year, or at least as long as the governor has COVID restrictions in place,” Struck said.

Best thing customers can do? “Use your debit card,” Struck suggested.