Credit unions need answers to emerging penny challenges
Credit unions and other financial institutions are facing uncertainty and operational challenges with the end of penny production, as outlined in a letter sent Monday to House Financial Services Committee leaders from America’s Credit Unions. It follows last week’s joint letter from America’s Credit Unions, the American Association of Credit Union Leagues, and all leagues addressing similar concerns and the need for clarity.
The letter urges Congress to act quickly by:
- Advancing the Common Cents Act (H.R. 3074), which clarifies rounding of cash transactions, directs the U.S. Treasury to stop minting pennies, and creates a uniform rounding standard;
- Encouraging the Federal Reserve to keep as many coin depots open and distributing pennies as inventory conditions allow, providing timely public notice when a site cannot fulfill penny orders, shifting inventory from surplus locations to areas facing shortages whenever feasible, providing regular public updates on inventory conditions and depot status, offering recommendations for institutions experiencing periodic penny shortages, and clarifying the continuing legal tender status of existing pennies; and
- Encouraging the Federal Reserve Board to work with the NCUA and other federal banking regulators to clarify acceptable interim rounding practices for cash transactions, including on whether the total bill or individual items should be rounded, when sales tax should be calculated, and recommended receipt disclosures.
Guidance is also needed on acceptable alternatives when exact change cannot be provided in cash.