The American Bankers Association today expressed support for the Common Cents Act [H.R. 3074], which renews calls for officially halting the production of the U.S. penny for general circulation.
President Trump last year directed the Treasury Department to stop producing pennies. The U.S. Mint produces coinage but the Fed distributes coins to banks and credit unions. Late last year, lawmakers from both parties said they were concerned about the Fed’s decision to stop accepting penny deposits or orders at many coin terminal locations across the U.S. At the time, ABA urged the Fed and Treasury Department to alleviate the operational challenges caused by the end of penny production.
ABA’s letter supporting the Common Cents Act said the legislation “would provide a clear and practical framework for cash rounding when exact change cannot be provided, while clarifying that checks, electronic fund transfers, credit cards, gift cards, money orders, and similar noncash payment methods are not subject to rounding.”
This approach, ABA said, helps consumers, businesses and financial institutions adapt with minimal disruption.
“By directing the secretary of the Treasury to cease production of the one-cent coin while preserving the legal tender status of existing pennies, this bill would help modernize the nation’s coinage system and reduce unnecessary costs associated with the production, handling, and distribution of pennies,” ABA wrote. “The required strategic plan and report from the Board of Governors of the Federal Reserve about supporting penny orders and deposits at their facilities would benefit financial institutions and consumers alike.”
ABA also commended Reps. Lisa McClain (R-Mich.) and Robert Garcia (D-Calif.) for sponsoring the legislation, as well as House Financial Services Committee Chairman French Hill (R-Ark.) and Ranking Member Maxine Waters (D-Calif.) for their leadership and engagement.
