The Potential Demise of the Penny is the Latest Step in Society’s Shift Away From Cash Payments

The U.S. may soon be without its lowest denomination of coin currency — the penny — if President Donald Trump gets his way. Trump took to social media platform Truth Social last week to let the country know he has the one-cent piece in his crosshairs.

“For far too long the United States has minted pennies which literally cost us more than two cents,” Trump wrote. “This is so wasteful! I have instructed my Secretary of the U.S. Treasury to stop producing new pennies. Let’s rip the waste out of our great nations budget, even if it’s a penny at a time.”

Trump’s comments that the penny costs more to make than its worth is correct. According to the U.S. Mint’s annual report, pennies cost 3.69 cents to produce in 2024, which is the 19th consecutive year that the price of manufacturing pennies has been higher than their face value. In total, the U.S. Mint lost more than $85 million by producing pennies in 2024. 

The beginning of his second stint in the Oval Office has seen Trump target what he perceives as wasteful spending in government. The president established the Department of Government Efficiency (DOGE) which has been tasked with modernizing the government’s technology and maximizing efficiency and productivity. 

The Department of Government Efficiency has suggested on social media that the penny is money the country can’t afford, citing that the coin’s production costs taxpayers nearly $180 million in 2023. Some of DOGE’s initial efforts to eliminate what the administration sees as taxpayer money being wasted have prompted controversy as the measures have been swift and some have resulted in layoffs.

But sunsetting the penny could find support on both sides of the aisle.

In a 2013 interview, then-President Barack Obama spoke in favor of retiring the penny.

“Anytime we’re spending more money on something that people don’t actually use, that’s an example of something we should probably change,” Obama said. “And one of the things you see chronically in government is it’s very hard to get rid of things that don’t work so that we can then invest in the things that do. And the penny ends up being, I think, a good metaphor for some of the larger problems that we’ve got.” 

Most people aren’t likely to fret too much should the penny go the way of other disused denominations, such as the $500 bill or the Susan B. Anthony dollar coin. But in a society where consumers have more ways than ever before to transact without exchanging physical cash, the potential demise of the penny may be a canary in the coal mine for those who prefer to use cash for purchases.

Many concerts and major sporting events now only accept cashless payments. Taylor Swift’s “The Eras Tour” grossed more than $1 billion in 2024, but concertgoers couldn’t make purchases inside some of the venues on Swift’s tour if they didn’t have access to a cashless payment method.

According to a poll conducted by Verizon, 80% of concert attendees have used a digital wallet at a live music event to make purchases. Removing cash from a transaction can create a smoother experience for buyers and sellers because lines tend to move quicker when customers and cashiers can avoid counting out dollars and providing change on a transaction. 

Payments companies also benefit from instances where events don’t accept cash. They can attract new customers when event attendees need to obtain a way of transacting without cash. Payments companies also benefit from the data they receive from digital transactions.

Events that don’t accept cash can communicate to ticketholders in advance so they’re prepared to make purchases digitally upon arrival. But what happens to individuals who aren’t equipped to make a cashless payment to enter an event? In some instances, they’re turned away.

We spoke with Jonathan Rosenblum, Founder at JR Payments, to learn more about the downsides of businesses moving away from accepting cash transactions. 

“On the surface, it’s all about ease and efficiency,” Rosenblum told us. “But under the hood, going fully cashless means consumers lose financial privacy. Plus, the unbanked and underbanked — millions of people — could get shut out of the system entirely.”

While cashless payments may cut down on wait times for those looking to stock up on merchandise or enjoy a meal while at the ballpark or arena, businesses must weigh whether faster interactions at the point of sale — and more access to customer data — is worth excluding the portion of the population who isn’t comfortable transacting with anything other than cash.

Pennsylvania recently passed a law that requires schools to accept cash payments when it comes to purchasing a ticket to a school-sponsored activity.

“In our Constitutional Republic, anyone willing to purchase a ticket with legal United States currency should never be discriminated against or denied entrance to a championship football game or any other school-sponsored activity simply because they do not possess a credit card or smartphone,” said Senator Cris Dush (R-PA), who sponsored the legislation.

Cashless transactions rely on a digital infrastructure to process payments. That can leave consumers and merchants without a way to buy and sell, respectively, when processing systems malfunction or internet services are interrupted. For some, the disadvantages of cashless payment methods are enough of a concern to favor continuing to allow for cash payments.

“I don’t think we should be pushing for a fully cashless future, but rather a hybrid model that keeps digital payments accessible while making sure people still have options,” Rosenblum told us.