#Currency Management

How to successfully design future-proofed cash centers

Global Trends
12 Mins.

The creation of a modern cash management center – whether for a central bank, a commercial bank, or a cash-in-transit company – needs to be rooted in a deep understanding of the client’s unique objectives, access to the best solutions, and a capability to address the challenges that will inevitably arise. We look at the professional expertise that underlies the delivery of state-of-the-art cash center infrastructures.

It’s a fact often obscured by the rise of digital payments, but cash is still the lifeblood of societies, all around the world.

In recent years, almost every region of the world has seen double-digital annual growth in the demand for cash. And even in highly digitalized economies, such as the euro area, almost 60% of all payments are still made in cash.1

However, ensuring that cash is accessible to everyone at key points along the cash cycle – from retail outlets to ATMs – has become a more complex and demanding challenge. 

It’s a challenge that cash centers are embracing. Whether operated by central banks or commercial entities such as retail banks or cash-in-transit companies, cash centers are the beating heart of the cash circulation system, keeping cash flowing smoothly around an economy and making it available where it’s needed. As such, the task of establishing a new cash center or renewing an existing one needs take into consideration not just the cash center’s own challenges but those of the complete cash ecosystem.

Key questions need to be answered to define the scope of such a project: what function will the cash center serve in the cash cycle? What are the local and regional conditions in which it will operate? What are the interdependencies across a broad network of cash-cycle partners? And what are the outlook for and likely development of a given region that need to be carefully considered?

Behind the successful execution of any cash center project lies professional expertise and sound data. That expertise needs to span consultancy and analysis, technical scoping, design, and project management, and be backed by broad and deep experience in the measurement and processes of cash center operations of any size, complexity, and regional situation.

Experience shows that the success of cash center project is dependent on two fundamentals: firstly, tapping into those professional partnerships as early as possible in the project, and secondly, the use of a structured, proven approach that is applied across all the different stages of the journey. 

Understanding unique customer objectives

No two cash centers are the same – and for good reasons. Every infrastructure project of this scale has its own set of goals and drivers to consider, and a unique set of rules and regulations that need to be followed:

  • For a central bank, the aim might be to ensure the future scalability of cash processing based on an expectation of growth in the country’s cash demand. 
  • Financial institutions might be highly focused on meeting sustainability or resilience targets — self-imposed or mandated. And at G+D, our experts for carbon-neutral cash center solutions offer great value when planning such a project.
  • In other circumstances, a commercial bank might define tighter security as the primary objective, while another may view efficiency and cutting the cost of cash as the paramount consideration. 
  • Additionally, the architectural design options for a cash center need to be given due consideration, as the design is often a factor on which customers have perspectives and preferences.

Whatever the motivation, to attain the desired outcome there needs to be a staged, end-to-end approach, which starts with defining project objectives, and builds through analysis, optimization, dimensioning, and, ultimately, layout. There are plenty of known instances where organizations have dived into the mid-stages of a project only to backtrack and rethink the approach, causing additional costs and endangering the timeline of the production phase. 

Sustainability is an all-too-present example of why it is so important to work through a set of well-defined and understood processes. Unless sustainability is factored in at the project’s outset, a cash center design that might be ideal for scalability could be less effective from a sustainability perspective. 

Similarly, if a brownfield cash center sets a goal on high levels of automation, an upfront assessment of the existing infrastructure and how easily it can be adapted to the use of robotics is vital for appreciating the required scale of structural changes. 

In the same way, unless the standardization of cash handling and transportation units is considered at the start of a project, there is likely to be an impact on the efficiency of workflows within the cash center, as well as on the ability to interface smoothly with other elements in the cash cycle.

Detailed view of a state of the art cash center

Taking a holistic perspective

To build a modern cash center (from scratch or as part of a renewal), our dedicated consulting teams always work in tandem with our customers to apply a proven set of processes that takes a holistic view of the cash center’s position in the wider cash cycle to ensure the delivery of an optimal solution. At G+D, the cash center consultancy team uses a five-stage approach that has consistently delivered success to clients around the world:

  • Objectives In-depth consideration of a customer’s goals and expectations is key to ensuring the solution delivers the desired results. That is sometimes at odds with a customer’s original ideas: for example, one European central bank recently revisited its pre-conceived design for a new cash center after the G+D team highlighted a solution that would fulfill the bank’s objectives even better.
  • Analysis Exploration of the end-to-end cash center opportunity is critical in order to discover its full operational potential. That means looking at all aspects of the cash cycle, including volumes, standardization, third-party interfaces, environmental and building issues, logistics, bottlenecks, data capabilities, and more. 
“Cash center projects need to be process- and functionality-driven – not driven only by technology – with the focus always being on the solution.“
Hermann Gessler
Head of Technical Sales and Consulting, Value Added Solutions and Services, G+D
  • Optimization To meets the customer-specific KPIs, the design principles behind the solution need to consider an array of factors, including efficiency, security, scalability, flexibility, throughput, and future-proofing. With those in mind, a consultancy team can provide expert advice on the best setup in terms of technology and equipment, systems integration, options for automation and standardization, as well as process design and functional areas. 

It’s a complex capability that needs deep experience and skillful orchestration, says Hermann Gessler, Head of Technical Sales and Consulting, Value Added Solutions and Services, at G+D. “There is no standard cash center that can simply be lifted and shifted to the next customer. Every cash center has specific needs – including those determined by local or internal rules. So selecting the optimal mix of technologies, facilities, and processes, with a laser-like focus on the customer requirement, is key,” he explains. A simple example relates to European cash centers: the European Central Bank sets rules on how euro banknotes should be packed – and that will determine how cash needs to be stored in the vault area of a new cash center.

  • Dimensioning Defining the optimal technology equipment setup for a cash center will depend on multiple factors: from automation and staffing levels to the planned use of standardized cash boxes. With different technologies involved, the role of coordinating the activities of multiple parties and constantly keeping those aligning to the customer’s goals is key. Also important is an ability to adapt to changing circumstances.

“Although technology is at the center of many projects, the approach should not be technology-driven; any project needs to be process- and functionality-driven, with the focus always being on the solution,” says Gessler. Typically, that means combining the best technologies and services from different suppliers. G+D consulting teams have experience working in the cash operations of hundreds of centers around the world, and their independence from any manufacturer means they can choose the right technologies for customers’ needs.

Working with a central bank recently, the G+D team took executives on a tour of three cash centers around Europe. “They were surprised to see three completely different automation technologies and three different vault technologies. But because we can draw on any of the technologies on offer in the market, we are able to assess which elements would best fit their goals,” says Gessler.

  • Layout Having aligned with the customer on their specific solution, the team can provide in-depth advice on the facility requirements and any adjustments to existing buildings that might be required. G+D typically creates a highly detailed 3-D model of the layout that features exact renderings of all the pre-defined technologies and equipment, the layout, and the processes throughout. That then becomes the basis for the setup for each functional area in the cash center.

Three cash centers; three solutions

Overview of a state of the art cash center

A greenfield cash center blooming in the desert
Central Bank of Egypt

As one of the world’s newest and most fully automated cash centers, the Central Bank of Egypt (CBE) facility, in the country’s New Administrative Capital, offers a prime example of how a complex, customized solution can be professionally planned and executed – even in the middle a pandemic and logistics upheaval, and in a city that was still itself under construction.

The CBE had multiple objectives for the project:

  • to satisfy the growing demand for cash in the country – now and for many years and decades to come
  • to build a state-of-the-art, future-proofed cash management infrastructure that could meet the highest levels of efficiency, flexibility, and automation
  • to establish new levels of professional competency and functional independence through a transfer of operational and technical knowledge over the project’s lifespan
  • to create an iconic symbol of a fast-modernizing Egypt in the country’s New Administrative Capital.

In pursuit of those goals, the CBE appointed G+D in mid-2017 as the general contractor for the whole project, which features an integrated large-scale printworks and highly automated cash processing and storage center. As part of the contract, G+D brought together specialists in architecture, construction, and logistics, and combined their know-how with its expertise in building design, high-tech engineering, IT, security, and automation.

Given that the construction took place as other key infrastructure, such as roads and public utilities, took shape around it, the development is truly remarkable. Just as extraordinary is the fact that the project execution progressed while much of the world was brought to a standstill by the global pandemic.

The finished CBE facility is the largest of its kind in the Middle East and Africa. It is also one of the world’s most automated, as key facts and figures highlight:

  • The four complete printing lines in the CBE Printing House together have a maximum capacity of printing of about five billion notes per year.
  • Two automated (no human operators) guided vehicles are used to move cash from the printworks to the cash center via a specially constructed 290-meter-long tunnel that connects the two buildings, with multiple security levels implemented along the route.
  • The cash center is set up with 12 G+D BPS® M7 high-speed banknote processing systems, designed for ultra-high levels of automation, ensuring a daily processing capability of millions of banknotes – and scalable by a factor of five to meet future processing needs.
  • Each of the cash center’s two vaults has a capacity to store a billion packaged, boxed, and palleted banknotes, with automated transport between vaults.
  • 1.4 km of conveyor belts connect all the functional areas of the cash center, including the 12 loading/receiving bays ,which have a receiving capacity of more than 20 million notes per day.

Such a greenfield site presented a rare opportunity to work without the physical constraints of an existing building, but the project’s success was down to some fundamentals, says Gessler: wall-to-wall operational expertise, agility in the face of changing circumstances, and an on-site presence. “The G+D approach ensured the project was able to overcome some unique challenges and is now delivering on the CBE’s expectations,” he adds. (See more: “New megacity showcases vision for Egypt’s future”)

Hyper-automation at a major commercial bank cash center
Bank Central Asia

At 3,600 m2, Bank Central Asia’s (BCA) cash center in Indonesia is one of the world’s most advanced. Its digitally connected systems and processes have been engineered to manage up to 10 million banknotes a day, with its vaults capable of holding 120 million banknotes. The scale of cash processing reflects the fact that BCA serves more than 34.7 million customer accounts and operates 1,247 branches and 18,268 ATMs.

The commercial cash center’s design goals were set firmly on cost efficiency and performance – a requirement that drove high levels of automation, guided by the expertise of G+D’s consulting team. They were involved at the earliest stages of the project to help explore BCA’s initial concept and its potential solution for the state-of-the-art cash center. That consultation phase resulted in the bank adjusting its original design – providing a valuable lesson in the importance of early-stage collaboration, says Hermann Gessler, Head of Technical Sales and Consulting, Value Added Solutions and Services, at G+D.

“As cash centers embrace higher levels of automation, more and more focus needs to put on the upfront objectives and analysis phases of a project,” he says. “If you are committing to high levels of automation in an existing cash center (as was the case with BCA), you’re inevitably bringing in lots of sophisticated equipment and you need to know your existing building is suitable for that.”

The collaboration also altered BCA’s perception of G+D as a partner, he says. “We’re a consulting partner more than a manufacturer of automation equipment, so initially the customer didn't consider us as a natural expert in automation.” But BCA quickly became convinced otherwise, coming to see G+D’s independence from any technology as a big advantage. “We know the processes, the market, and cash center technologies inside out, and we are able to simply choose the best solutions for customers’ requirements without any vested interest,” says Gessler.

The end result was clearly appreciated by the bank. “The G+D team transformed BCA’s dream into reality: [creating] the first fully automated cash center for commercial banking in the world,” said Ibu Anna Susilowati, Senior Vice President of Electronic Banking Services at BCA, when the project went live.

Automating vaults at a brownfield central bank
National Bank of Rwanda

An existing cash center is always going to have more constraints than a greenfield site. So when the National Bank of Rwanda partnered with G+D to automate the management of its vault facilities, project teams realized from the start that success would be dependent on embracing an integrated and holistic approach.

With ever-growing demand for cash in the country, the bank’s overall goal was to bring greater efficiency and capacity to its vault system by using advanced automation and streamlined processes. By investing, it would not only make optimal use of its cash center’s finite space, but it would also introduce higher levels of security.

The project begun with an in-depth analysis to create a clear picture of demand and circulation patterns for the Rwandan franc – now and into the future. The team considered such elements as inflation, population growth, and macroeconomic factors, as well as how money is typically distributed throughout the country.

The proposed solution focused on three key areas: optimizing the existing vault by maximizing the capacities, while minimizing building modifications; increasing the security of cash in the vault by implementing order fulfillment and guaranteeing the traceability of the cash movements; and the streamlining of logistics and cash movement, both inside the central bank and between its headquarters and five branch sites. The automated solution was based on G+D Compass VMS® Logistics software and state-of-the-art technologies from G+D partners, hand-picked to meet the bank’s unique specification.

The result is a robotics-driven vault with three times the previous capacity for banknote storage, increased security through the elimination of most hands-on-cash processes, and a dramatic increase in the overall efficiency of the bank’s cash cycle.

To future-proof the solution, flexibility and responsiveness were built into the design from the start. And the integrated solutions has constantly been revisited to ensure that the most effective approaches are being employed – including the opportunity to enhance the performance of the vault storage system by deploying more cash-moving robots. (View the complete National bank of Rwanda case study here.)

Forging trusted partnerships

Even though G+D’s cash center projects are all very different in scope and ambition, they have one fundamental in common: success comes from establishing and sustaining a close, trusted partnership between customer and key solution providers right from the start.

Key takeaways

  • Every customer’s cash center ambition is driven by a unique set of objectives – and fulfilled by a unique solution set
  • Cash center projects need to be process- and functionality-driven – not technology-driven.
  • As automation plays an ever-bigger role in cash centers, there is more need for in-depth, early-stage project analysis. 
  1. Cash remains the most frequently used means of payment, European Central Bank, 2022

Published: 29/08/2023

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