A glimpse into the future of currency management

From forecasting to predictive collection, from synchronized planning to smart currency centers – there are a range of digital solutions that help cash cycle players manage their cash better and optimize cash operations. Digital twin solutions such as Compass System Intelligence use cutting-edge technology to allow industry players to access, monitor, and utilize valuable cash processing data.

By ensuring the synchronization of all industry players, efficiency can be maximized. In addition, through the digital connection of ATMs, an intelligent supply of cash, and predictive collection, it is possible to save on costs and reduce manual steps and manual work. Dr. Marcus Schmeisser, Product Manager, Data Analytics, at G+D notes that digital solutions drive not only efficiency, but also profitability. “Cash forecasting can significantly reduce costs,” he says. “For example, ATM forecasting can dramatically decrease the number of stops the armored courier has to make.”

Cash centers will develop into currency centers, whereby cash and CBDC operations will be bundled in secure, interconnected, and seamless environments. These will fuse cash management and CBDC data centers for a holistic overview of the currency cycle.

The vision is that an interdisciplinary dashboard allows for simultaneous CBDC and cash monitoring, meaning forecasting is made simple, transaction rates can be easily surveilled, and demand projections can be generated. The result? Increased transparency, enhanced efficiency, and real-time analysis.

With the increased use of digital solutions, current security measures for physical money will need to be expanded upon to encompass cybersecurity measures, and to protect from data breaches, data theft, and growing digital risks. With the launch of CBDCs, security will be taken to the next level. An ECB public consultation on the digital euro noted that privacy and security were considered the most important features of a CBDC.³ Trust in any currency is determined by how secure it is, and that trust is imperative to the long-term success of a digital currency.

The evolution of the currency ecosystem will require new skill sets, in interdisciplinary teams that have multiple capabilities. To ensure a smooth transition, financial institutions will have to focus on the development of these skills – comprising data management, cryptography, and cybersecurity.

It has taken centuries, indeed millennia, to develop cash and the current cash cycle. CBDC is an evolution of physical cash, and innovation always comes with learning new things. The launch of CBDCs into new markets will provide chances for iterative learning – and the opportunity to expand project activities step by step.