Across the United States, shoppers at Kroger supermarkets are encountering an unusual request at checkout: “Please provide exact change.” The reason isn’t a staffing issue or a product shortage—it’s the result of a historic shift in U.S. currency policy. The federal government has halted production of the penny, sending ripples through retailers, banks, and everyday transactions.
Penny Production Halted
In February 2025, President Donald Trump directed Treasury Secretary Scott Bessent to end the minting of the one-cent coin, calling it “wasteful” and noting, “for far too long, the United States has minted pennies that cost us more than 2 cents each.” The move followed months of advocacy from the Department of Government Efficiency, which highlighted the rising costs of producing the mostly copper coin. In fiscal year 2024, the U.S. Mint lost $85.3 million on penny production, with each coin costing about 3.69 cents to make.
The Treasury placed its final order for penny blanks in May 2025, and the Mint produced its last pennies in August. Although there are still an estimated 250 billion pennies in circulation, the halt in new production quickly led to shortages at banks and retailers. According to Federal Reserve data, by late October, more than half of the nation’s coin-distribution terminals had stopped providing pennies.
Retailers and Communities Feel the Pinch
The shortage has forced major retailers to adapt quickly. Kroger, which operates over 2,700 stores in 35 states, posted notices in more than 100 locations in Ohio alone, explaining the situation to customers and encouraging them to use exact change. “Kroger will continue to accept pennies for payment,” a company spokesperson clarified, but the company is “assessing the impact” of the Treasury’s decision.
Other chains are improvising as well. Kwik Trip, a Midwest convenience store operator with about 850 locations, announced it would round cash transactions down to the nearest nickel. “It hit a lot sooner than anybody thought,” said Dave Niemi, a Kwik Trip spokesperson, who estimated the company could lose millions annually by rounding in customers’ favor but considered it necessary to maintain goodwill.
The impact is especially acute in rural areas and among low-income Americans. Bill Maurer, director of the Institute for Money, Technology and Financial Inclusion, explained, “Stopping penny production and halting deposits at coin terminals gums up the whole distribution system.” Small businesses and rural banks, already operating on thin margins, are struggling to keep coins in circulation and transactions running smoothly.
Industry-Wide Adjustments and Legal Hurdles
The penny shortage has become what a Home Depot spokesperson called “truly an industry-wide concern.” McDonald’s franchises in Chicago and other cities have begun rounding purchases to the nearest nickel to keep lines moving. Retailers are improvising to manage dwindling coin supplies while trying to keep checkout experiences fair.
On September 30, a coalition of major retail groups, including the National Retail Federation and the Retail Industry Leaders Association, sent an urgent letter to Congress. “Businesses simply cannot provide exact change any longer because they cannot get pennies,” the letter warned, urging lawmakers to pass a national law allowing cash transactions to be rounded to the nearest nickel.
Legal and regulatory requirements further complicate the issue. Retailers participating in the Supplemental Nutrition Assistance Program (SNAP) must treat all customers uniformly, making it difficult to round cash transactions while maintaining exact pricing for card or mobile payments. “Without clear guidance from USDA, retailers face uncertainty about remaining compliant with SNAP rules while managing a very real coin shortage,” said Max Wengroff of the National Grocers Association.
At least ten states or localities have laws prohibiting businesses from rounding cash transactions, adding another layer of complexity to the issue. The National Association of Convenience Stores highlighted how this patchwork of regulations makes it difficult for retailers to respond uniformly.
Legislative Efforts and Global Comparisons
In response, lawmakers introduced the Common Cents Act in April 2025, aiming to formalize the end of penny production and permit rounding cash transactions to the nearest nickel. The bill passed out of committee with bipartisan support. Representative Lisa McClain, a sponsor, noted that continuing penny production for three more years would cost taxpayers $225 million.
Globally, the U.S. is not alone in phasing out low-denomination coins. Canada eliminated its penny in 2013, and Australia and New Zealand did so even earlier. In those countries, cash transactions are rounded to the nearest five cents, and studies have shown that this has a minimal impact on inflation or consumer prices.
Looking Ahead: A Historic Transition
The penny has been a fixture of American commerce for over 230 years, first minted in 1793 and featuring Abraham Lincoln since 1909. As the copper coin fades from daily life, businesses and consumers are adapting to new operational and legal realities. The Treasury estimates that ending penny production will save approximately $56 million annually in material costs; however, the transition is not without challenges.
As the holiday shopping season approaches, retailers worry that the shortage could disrupt peak sales periods. The debate over the penny’s future—balancing cost savings against tradition and fairness—reflects a broader shift in how Americans handle money, signaling the end of an era and the beginning of a new chapter in everyday transactions.