Penny Phase Out
Visit this page for the latest updates and clear guidance on what the penny phase-out means for you.
Key Information
Here's What You Need to Know About the Penny Phase-Out
The U.S. Treasury will begin phasing out the penny in 2026 due to high production costs. Once the Federal Reserve distributes the remaining supply, banks will no longer be able to order new pennies. Pennies already in circulation will remain legal tender and can still be spent or deposited.
As supplies decline, some retailers and financial institutions may round cash transactions to the nearest nickel when pennies aren’t available. Countries like Canada and Australia use the same approach.
Digital payment methods—including debit card transactions, ACH payments, mobile deposits, Bill Pay, and online/mobile banking—will continue to process exact amounts, with no rounding applied. These tools offer customers precise payment totals and uninterrupted service during the national phase-out.
If you have questions about the penny phase-out, rounding, or depositing pennies, visit a local branch or contact our Customer Support Team.
Frequently Asked Questions
We’ll share new updates here as more information becomes available.
Why is the penny being retired?
The U.S. Treasury is ending production of the penny because it now costs more to make the coin than it’s worth. As part of this change, the Federal Reserve will wind down distribution and stop supplying new pennies beginning in 2026.
Can I still spend or deposit pennies?
Yes. Pennies remain legal tender, and you can continue to spend, deposit, or bring them to an MSB branch during the transition. We’ll accept them as long as we have the ability to process coin.
What happens now that penny production has ended?
As the remaining supply of pennies continues to decline:
- Some businesses may round the final cash total to the nearest five cents.
- Only the ending amount of a cash purchase may be rounded – never individual items.
- Digital payments, including cards, mobile wallets, Zelle®, ACH, and online banking, will continue to process exact amounts with no rounding.
Will electronic payments change?
No. If you pay with a card, mobile wallet, Zelle®, ACH, or online banking, your payment will always process to the exact cent. Rounding applies only to cash transactions.
Does this affect my account balance?
Not at all. Your balances and account activity stay exactly the same. The change only affects how cash is handled when pennies are not available.
How does cash rounding work at Machias Savings Bank?
As pennies become less available, some cash transactions may be rounded to the nearest nickel when pennies aren’t available. This only applies to cash payouts.
Quick Explanation
- Totals ending in .01–.04 are rounded up to .05
- Totals ending in .06–.09 are rounded up to .10
- Totals ending in .00 or .05 are paid as-is (no rounding)
Examples:
- $25.01 → $25.05
- $25.04 → $25.05
- $25.07 → $25.10
- $25.09 → $25.10
- $25.05 → $25.05 (no change)
- $25.00 → $25.00 (no change)
Important disclosure: Machias Savings Bank reserves the right to modify or discontinue this cash rounding practice at any time, with or without prior notice.
How can I get ready for the transition?
- Take advantage of digital payment options, such as our mobile app, debit card, and Zelle®—to avoid rounding altogether.
- Keep an eye out for local businesses’ posted rounding practices.
- If you have jars of pennies at home, consider depositing them now.
Will Machias Savings Bank continue accepting pennies?
Yes. As long as pennies remain legal tender and our equipment and supply allow, we will continue accepting pennies for deposits and payments.
How is Machias Savings Bank supporting customers through this change?
- We are expanding and promoting digital banking options to help customers continue making exact-amount payments.
- Our team is being fully trained on the process so we can answer questions and guide customers confidently.
- We’ll share updates as the transition moves forward, so you always know what to expect.
