I’m seeing places that say they’re short on coins, how does this happen? I looked it up and I’m still confused.
In: Economics
Businesses need coins for giving change and they get those coins from banks. Banks either get coins from the government or from people and businesses who deposit them.
Only a certain number of coins are freshly made by the government, so the majority of the coins needed in circulation have to come from bank deposits.
During COVID there has a significant drop in people eating out and shopping, and people switched to using cashless payments. So instead of the coins in circulation being spent or deposited, they’ve been hoarded.
Since businesses still need to hand out change for purchases there’s a shortage.
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