US Ends Penny Production: What Credit Unions Should Know

The US Mint has officially stopped producing pennies, ending more than two centuries of one-cent coin circulation. While billions of pennies remain legal tender, no new pennies will enter general circulation. President Donald Trump approved the move as production costs continued to exceed the coin's value.

The Federal Reserve has already suspended penny orders at more than half of its distribution centers, signaling the start of a national transition away from 1-cent coins. It has posted FAQs about Penny Order and Deposit Information

The Treasury Department is considering guidance on rounding cash transactions to the nearest nickel, but businesses across the country are calling on Congress to establish a national rounding standard. Retailers, grocers, restaurants, and gas stations warn that without federal direction, inconsistent rounding practices could expose businesses to consumer protection lawsuits. The Federal Reserve Bank recently released a brief on rounding up. You can read the report here.

Credit unions can assist members and businesses adjust. Key steps include:

• Updating cash-handling procedures as pennies phase out.
• Educating members that existing pennies remain legal tender.
• Supporting businesses in preparing for potential rounding rules.
• Monitoring federal action as Congress considers nationwide standards.

The Association will keep members informed as guidance evolves.