The Division of Cash and Custody of the Federal Reserve of New York reported on the decrease in inventories of coins at the national level as a result of the pandemic COVID-19, detailed the Association of Banks in Puerto Rico.
The bank said in a written communication that this decline largely is due to the interruption of the circulation of currency and the reduction in the production of coins by the U. S. Mint (issuing authority of the currency of the united States) due to the protection measures put in place for their employees.
In turn, the orders of coins by depository institutions at the Federal Reserve have increased, after the reopening trade, resulting all this in the inventory of coins from the Reserve has been reduced temporarily.
The deficiency of coins (25¢, 10¢, 5¢, 1¢) locally is reflected, as the banking industry in Puerto Rico depends largely on the inventory and supply of coins of the Federal Reserve of New York.
The banks of the united States and Puerto Rico are experiencing a reduction in the supply of coins by the Federal Reserve, which will span several weeks, said the Association.
This, due to a measure implemented by the Reservation that assigns limits proportional in the distribution of coins to the depository institutions, to ensure an equitable distribution of the inventory of coins existing. This measure does not apply to the different denominations of the dollar (tickets).
“It is important to clarify that this is a national situation as a temporary that is out of the control of the local banking and business in Puerto Rico. We are aware that there is a high circulation of coins in the Island. The commercial banks are working on strategies to mitigate this situation,” he said Zoimé Álvarez Rubio, executive vice president of the ABPR.
Encourage use of electronic payment facilities in Puerto Rico
The ABPR and its member banks encourage the citizens to make use of the means of electronic payment to the extent possible. Also, recommends that if you are going to carry out a payment in cash, try to do so with exact change or coins to help the recirculation of coins through the shops.
“We emphasize that it is not a situation provoked by the merchants, and the banking system is evaluating all of the alternatives to support and meet the needs of their commercial customers, for the duration of the situation. We will continue to closely monitor this situation, and maintaining constant communication with the Federal Reserve of New York about the evolution of the same, ” added Alvarez.
The Federal Reserve is working on several fronts to mitigate the effects of low inventories of coins. This includes the management of the allocation of existing stocks of the Fed, working with the U. S. Mint to minimize the restrictions of the supply of coins, maximize the capacity of production of coins, and the exhortation to depository institutions to sort only the currencies that need to meet the demands of customers in the short term.
The Federal Reserve is working in conjunction with the Reserve Banks and the U. S. Mint, and is already starting to be a recirculation of the coins as the economy continues to re-opening.