In the fiscal year 2020, the US Mint produced over 24 percent more circulation coins than in the previous year. A record of 15.5 billion coins were produced by all US Mints between 1 October 2019 and 31 September 2020. That is an impressive increase in times of a pandemic. Mostly nickels (5 cents), dimes (10 cents) and quarter dollars (25 cents) were put into circulation, according to the US Mint’s 2020 annual report. But why did they increase mintage numbers?
The USA Is Looking for Its Small Change
The reason for increased mintage figures is a shortage of cash in the USA that has been going on for months. The #GetCoinMoving campaign is running on various social media channels. A promotional video was released by the Food Industry Association asking citizens to pay exact cash whenever possible. Otherwise, payments become a one-way street: customers use currency of large denominations to pay and retailers constantly have to hand out small change.
David Ryder, the Director of the US Mint, personally addressed his fellow citizens in a video released at the end of June 2021. He stressed that the mints were doing their best and significantly increased their mintage numbers. However, the shortage of coins in everyday life cannot be remedied by an increased coin production alone, as Ryder pointed out: “This is not a coin supply problem, it’s a circulation problem”. Ryder asked people to use exact change for transactions or to recycle coins at retailers or financial institutions in order to put them back into circulation. After all, Ryder said in his video message, there are many people who rely exclusively on cash and who are now suffering from its unavailability.
The US Mint was able to increase its seigniorage, i.e. the difference between the profit gained from producing coins and the production cost, by 72.8 percent to $549.9 million in the last fiscal year. However, in the medium term the mint will probably benefit more from citizens using their cash consciously and thus ensuring continuous circulation. This is the only way to guarantee that people can continue to benefit from the advantages of cash and for cash to be widely accepted.
You can read the latest annual reports as PDFs on the US Mint’s website.
Here you can watch the appeal of the Food Industry Association.
And even in the US, cash was the most commonly used payment method in 2019.
Here you can find out about the world’s most cash reliant countries.