Across the U.S., Kroger shoppers are seeing something they’ve rarely seen before: signs asking for exact change at the checkout. It isn’t about a short-staffed line or a product shortage—it’s about the humble penny and the ripple effect of a policy shift.
According to Kroger, the notices reflect the impact of the U.S. Treasury’s decision to halt production of the one-cent coin.
What’s in the Notice?
In the Cincinnati and Dayton area alone, 103 Kroger stores posted signs explaining that the federal government has stopped minting new pennies, which is affecting supply nationwide. The sign reads: “The U.S. Treasury has ceased penny production, affecting supply nationwide.”
Kroger said the company “will continue to assess the impact of the U.S. Treasury’s decision to end penny production.”
Kroger’s Message to Customers
What does that mean for you in the checkout lane? Kroger kindly asks cash-paying customers to consider providing exact change. The spokesperson emphasized: “Kroger will continue to accept pennies for payment.”
The notice marks a significant operational adjustment for one of America’s largest grocery chains, which runs over 2,700 stores in 35 states.
A Big Shift from the Top
The penny phase-out traces back to February 2025, when Donald Trump directed Treasury Secretary Scott Bessent to stop penny production, calling the practice “wasteful”.
Trump wrote that “for far too long, the United States has minted pennies that cost us more than 2 cents each”.
Why the Penny Was on the Chopping Block
The decision followed months of advocacy by the Department of Government Efficiency, which flagged rising cost in minting the mostly-copper coin. In fiscal year 2024, the U.S. Mint produced nearly 3.2 billion pennies but lost $85.3 million, at about 3.69 cents per penny. That’s up from ~3.1 cents in the prior year.
When the Penny Production Stopped
The operation timeline: the Treasury placed its final order for penny blanks in May 2025, and the Mint reportedly produced its last pennies in August.
With production stopped, retailers and banks say the shortage arrived far sooner than expected.
Retailers and Banks Caught Off Guard
Experts say the shortage caught many unprepared. Bill Maurer of the Institute for Money, Technology and Financial Inclusion said: “I knew that there would be some chaos coming, but I didn’t think that it would come this fast.”
Dylan Jeon at the National Retail Federation echoed that sentiment: “This shortage came a lot quicker than any of us had anticipated.”
Concrete Numbers from the Fed
According to Federal Reserve data, of 165 coin-distribution terminals, 41 had already stopped providing pennies by early October 2025. By late October, that number jumped to 83.
The American Bankers Association describes the issue as “localized supply issues,” noting about 250 billion pennies remain in circulation.
Two Trouble Spots in the System
The shortage stems from a double hit. First, new penny production has completely stopped. Second, existing supplies aren’t circulating properly because several Federal Reserve coin terminals have stopped accepting penny deposits. Together, these changes have created what Maurer calls “critical choke points” in the nation’s coin distribution system.
Who Gets Hurt the Most
Maurer explained that stopping penny production and halting deposits at coin terminals “gums up the whole distribution system,” creating ripple effects nationwide. The fallout, he said, lands hardest on low-income Americans and the small businesses that serve them.
Rural banks and communities, already operating with thinner margins, struggle to keep coins in circulation and transactions running smoothly.
Other Retailers Start Adjusting
Midwest convenience store chain Kwik Trip—operating about 850 locations—announced it will round cash transactions down to the nearest nickel as penny supplies run dry. Spokesperson Dave Niemi said, “It hit a lot sooner than anybody thought.”
The company estimates it could lose millions annually by rounding in customers’ favor, but says it’s worth it to maintain trust and goodwill.
Industry-Wide Concern
A Home Depot spokesperson called the penny shortage “truly an industry-wide concern” disrupting cash transactions. McDonald’s franchises, especially in Chicago, have begun rounding purchases to the nearest nickel to keep lines moving.
From big-box stores to local convenience chains, businesses are improvising to manage dwindling coin supplies while trying to keep customers’ checkout experiences smooth and fair.
The Retailers’ Letter to Congress
On September 30, 2025, a coalition of major retail groups—including the National Retail Federation, Retail Industry Leaders Association (RILA), FMI – The Food Industry Association, and the National Grocers Association—sent an urgent letter to Congress warning that stores are running out of pennies.
“Businesses simply cannot provide exact change any longer because they cannot get pennies,” the letter said. The coalition urged lawmakers to pass a national law allowing cash transactions to be rounded to the nearest nickel.
Holiday 2025 Looms as a Pressure Point
RILA’s senior executive vice-president of public affairs, Austen Jensen, said in an October 14 release that retailers are “increasingly worried that the penny shortage will negatively affect operations as we approach the busiest shopping season.”
Without federal action, they face mounting risks during peak transaction periods.
SNAP and Compliance Trouble
The shortage creates pain-points for retailers participating in the Supplemental Nutrition Assistance Program (SNAP). Industry groups told Brooke Rollins, Agriculture Secretary, that the shortage is “beginning to cause a cascade of negative events in stores across the country.”
Under SNAP rules, authorized retailers must treat all customers uniformly, complicating rounding vs exact-price rules.
Rounding vs Equality: A Legal Quagmire
If a store rounds cash transactions to the nearest nickel while maintaining exact pricing for card or mobile payments, it could run afoul of the SNAP “equal treatment” provision. Max Wengroff of the NGA explained:
“Without clear guidance from USDA, retailers face uncertainty about remaining compliant with SNAP rules while managing a very real coin shortage.”
State Laws Add More Complexity
Beyond federal rules, at least ten states or localities have laws prohibiting businesses from rounding cash transactions up or down. The National Association of Convenience Stores highlighted how this patchwork regulatory web complicates response efforts.
Without uniform legislation, retailers must navigate a complex terrain.
Legislation Moves — But Not Quite There
The Common Cents Act, introduced in April 2025 by Lisa McClain and Robert Garcia, aims to formalize the end of penny production and permit rounding cash transactions to the nearest nickel.
It passed out of the House Financial Services Committee in July with bipartisan support; McClain noted that continuing penny production for three more years would cost taxpayers $225 million.
Why the Shortage Feels Surprising
Even though over 114 billion pennies are still in circulation, the ABA notes that many people don’t use them — they stash them in jars or toss them into drawers.
That hoarding, combined with halted production, accelerates effective removal of pennies from commerce.
Cost Savings vs Cultural Value
The Treasury estimates that ending new penny production immediately saves about $56 million annually in material costs, with further savings as facility usage declines.
While proponents say the penny is a logical cost-cutting move, opponents argue the coin helps maintain lower prices and supports charitable fundraising.
A Historic Shift in American Money
We’re witnessing a turning point. The penny has been part of U.S. commerce for over 230 years—first minted shortly after the United States Mint’s establishment in 1792, and featuring Abraham Lincoln since 1909, the first U.S. coin to depict a real person.
As the copper-toned coin gradually disappears from daily circulation, businesses and consumers alike are adapting to the operational and legal complexity of this historic transition.