Coins like pennies, nickels, dimes, and quarters have been part of everyday commerce for hundreds of years. Starting in 2026, the U.S. penny will be retired, and the government will stop producing new pennies.
For business owners, this change affects cash handling, staff training, and daily transactions. Understanding how the penny retirement impacts your operations can help you prepare and adapt smoothly.
Why Pennies Are Being Retired
- High production costs: It costs more to produce a penny than its face value due to materials and labor.
- Declining usage: Pennies are used less frequently, and many end up saved or discarded.
The retirement of the penny aims to simplify cash transactions, reduce unnecessary costs, and make coin circulation more efficient.
What This Means for Your Business
- Pennies remain legal tender: Businesses can still accept them, but supply may become limited over time.
- Cash rounding may be implemented: A proposed bill in Congress recommends rounding totals to the nearest five cents. For example, $1.02 could round down to $1.00, and $1.03 could round up to $1.05. Rounding practices may vary by retailer, state, or local rules.
- Electronic payments remain unaffected: Card and digital transactions continue as usual, offering a reliable alternative to cash.
How Your Bank is Supporting Businesses
We know this change may raise questions for businesses. Here’s how your bank is supporting your business:
- Monitoring coin supply: Ensuring pennies remain available to businesses while possible.
- Coordinating with authorities: Working with the Federal Reserve and Treasury to manage coin distribution.
- Providing guidance and support: Offering operational advice to help businesses handle cash transactions smoothly.
- Advocating for customers: Supporting policy solutions such as allowing penny deposits at closed terminals.
How to Prepare Your Business for the Penny Retirement
The upcoming penny retirement means businesses need to plan ahead for cash handling, coin shortages, and customer communication. Here are practical steps to adapt smoothly:
- Round cash transactions: Update procedures to round totals to the nearest five cents to simplify transactions.
- Manage coin inventory: Monitor penny and small-coin supplies, and adjust how coins are handled in your registers.
- Train staff: Ensure employees can explain rounding and other changes clearly to customers.
- Promote electronic payments: Encourage card and digital transactions to reduce reliance on coins, and consider incentives to make this easier for customers.
- Stay informed: Monitor updates from your bank, local authorities, and industry groups regarding rounding rules, coin supply, and legislation.
- Communicate with customers: Clearly explain how cash totals may be rounded or managed.
The retirement of the penny is an important shift in U.S. currency, but it’s one your business can handle with planning and preparation. By staying informed, adapting your processes, and using available resources, your business can move forward confidently into this new cash environment.
