(Reuters) - Nour Ismail, a cashier at the All-Star Deli & Grocery in Manhattan, says the handful of pennies tossed into the bodega's tip jar by the end of the day is mostly a nuisance, rather than a welcome reward for good service.

As a tip, pennies are nearly worthless, the 24-year-old said, adding that the offering shows customers' kindness and sometimes they add up. But, "pennies don't matter," he said with a shrug.

It is a point of view shared by U.S. President Donald Trump, who said on Sunday that he had directed the U.S. Treasury, which oversees the U.S. Mint, to end production of pennies.

The announcement, which Trump made on his Truth Social platform, has stirred up a decades-long debate about the utility and cost of the copper-colored one-cent coin.

Those pushing for their demise say pennies are wasteful, and point to countries such as Canada that have successfully pulled them out of circulation.

According to the Mint's annual report, a penny last year cost 3.69 cents to produce, up about 20% from 2023 due to the cost of materials, including zinc.

Larry Jackson, 65, a life-long numismatist - meaning someone who studies coins - and proprietor of Larry Jackson Rare Coins in Atlanta, supports Trump's plan.

"People don't want them. They don't use them. They sock them away in cans and drawers and jars and try to bring them in here by the sackful," Jackson said. "We don't want them. Even a thirty-pound bag won't fetch you $50."

Jackson said there are collectors who hoard pennies minted in 1982 and before for their copper value. But that scheme would only work if it ever becomes legal to melt them down, he said.

Despite Trump's directive, it is unclear whether the president has the power to end production of the penny, as the Mint derives its authority from Congress, according to its website. Neither the Treasury Department nor the U.S. Mint returned phone calls seeking comment.

BAD FOR CONSUMERS?

Advocates for the penny argue that the coin plays an important role in U.S. society. People toss them as loose change into a jar for charity or use them to pay for single items at convenience and grocery stores.

"The key issue is that it is bad for consumers and the economy," said Mark Weller, director of Americans for Common Cents, a lobbying group backed by businesses involved in the coin's manufacture.

Weller said polling shows Americans do not like rounding, and grocers and corner stores, facing razor-thin margins, are likely to round up if the coin is discontinued.

In addition to fueling inflation, discontinuing the penny would "disproportionately hurt lower-income groups, people who are unbanked and underbanked and are relying on a cash economy," Weller added. "Cash is cheapest for consumers."

But a 2007 Wake Forest University study of a multi-state convenience store chain offered evidence that eliminating the penny would not create a rounding tax, and would not contribute to rising prices.

"Losing the penny was just a wash for the consumer," said Robert Whaples, professor at Wake Forest who authored the study. "It's as much rounding up as it is down."

Sean Snaith, an economist and director of the Institute of Economic Competitiveness at the University of Central Florida, agrees that the penny is an historical relic.

"Gone are the days of penny candy or even buying a gum ball for a penny," Snaith said.

"I think at some point in history cancelling the penny would have been a bigger deal, but now people don't even carry them in their pockets," he said. "They're largely not in circulation."

Snaith said that the nickel, which costs more than 13 cents to make but is only worth five cents, is an even bigger loss leader.

"We're losing more money on the nickel; people should worry about that," he said.

Canada announced in 2012 that it was eliminating the penny, saying the coin had retained only a twentieth of its original purchasing power and taking it out of circulation would save C$11 million annually.

Prices for cash transactions were rounded up or down to the closest five cents. Non-cash payments such as checks, credit and debit cards continued to be settled to the cent.

Richie Figueroa, 55, of Staten Island, agrees pennies are more a nuisance and would welcome the move to get rid of them.

"A lot of times I go into the store, I don't even wait for change for pennies," Figueroa said. "What purpose do they serve?"