Cash centers and casinos in the US cash cycle

Slot machines and table games in American commercial casinos generated almost $44 billion in revenue in 2022, according to Forbes.¹ Additionally, Native-American-owned gaming properties accounted for just over $40 billion in revenue. If you think that’s a lot, consider that there are about 3,500 casinos in the US and Canada, catering to millions of people enjoying the various gaming, hospitality, and other entertainment options these properties offer. A significant portion of that business is transacted in cash.

All that cash needs to be sorted, counted, stored, and deposited. Its management requires planning and foolproof security, because everybody knows it is there. No wonder so many movies are made about the cash that cycles through a US casino on any given day.

It’s different in the US

Contrary to what many people might think, US casinos aren’t concentrated only in places like Las Vegas or Atlantic City, where gambling operates under commercial gaming licenses. About half is generated by “tribal gaming” or “Native American gaming,” which comes from casinos operating on Native American tribal lands. The WinStar World Casino and Resort in Oklahoma, operated by the Chickasaw Nation, is the largest casino globally, based on number of slot machines (12,000+). 

Aside from casinos, cash center processing facilities are critical to the cash management landscape in North America. (For the purposes of this article, “cash center” refers to a wholesale currency processing facility.) Numbering about 400 between the US and Canada, these cash centers can be run by cash-in-transit players with roots in security and armored transport, such as Loomis, GardaWorld, and Brinks, or commercial banks that still do their own currency processing, such as Wells Fargo and U.S. Bank.
 
Much of what they do will be familiar to those in different jurisdictions – picking up the commercial deposit from retailers, restaurants, grocery stores, etc.; reconciling the stated deposit against the actual amount received; sorting by denomination; and recirculating that currency. However, one thing US cash center operators generally don’t do is sort for fitness, unless the banknote is obviously mutilated or represents excess reserves. Only those categories of banknotes will be passed back to the Federal Reserve Bank for verification and potential destruction, depending on condition. Everything else is recirculated. 

The US cash logistics market was estimated to be worth $5.7 billion in 2022.² The global outlook is bullish as well. One of the major constituents of the cash logistics market is cash-in-transit. CIT worldwide is set to record 5.7% CAGR, hitting $14.4 billion by 2030.³

Similarities and differences

“Think of the operational area of a casino as a cash center,” said Martin Bauer, Vice President of G+D in the US. Typically, cash processing is done in a “count room,” main vault, or the cashier’s cage, with the count room being the dominant place. “They’re still processing deposits like in a wholesale cash center,” said Bauer, “but all the deposits are represented by internal cash points, whether slot machines, table games, food and beverage, retail outlets, etc.”
 
Consider a slot machine: it contains a cassette that has banknotes of different denominations, along with tickets and coupons that represent winnings from other areas in the casino. That cassette is brought to the count room, where its actual contents are validated against what the deposit is reported to contain by the slot machine itself. The deposit is verified, counted, and sorted. “But it’s all internal deposits, within the casino environment,” pointed out Bauer. This points to one major difference between a casino’s count room and a commercial cash center. Namely, even though they perform the same tasks, a casino’s count room verifies numerous small deposits from within its own space, while cash centers process large commercial deposits from multiple retail customers, ATMs, etc.

Within the casino sphere, there is a further significant point of difference: size. While there are about 3,500 casinos in North America, roughly half have fewer than 500 slot machines. At the other end of the spectrum, about 50 large casinos have more than 2,500 slots each. Those are the ones that require the most planning and infrastructure when it comes to cash management.

Robust, secure, and efficient

What unites the casino and cash center segments is their common need for security and reliable efficiency. Increasing automation is one way to attain these goals. Take the case of the Seminole Hard Rock Hotel & Casino in Tampa, Florida. With over 5,000 slot machines, this is the largest of the Seminole Tribe’s six properties in Florida. Stopping operations at a casino to service machines or upgrade them is not an option. Off-peak maintenance and migration to new systems, on-site training, and on-call service are just some of the things large casinos, like the Seminole Hard Rock Hotel & Casino, look for.

A need for robustness, speed, and service that minimizes downtime brought this property into partnership with G+D more than a decade ago. From one BPS^® 500, it graduated to three BPS^® 1000s, and now operates seven M5s across their Florida properties.

Three generations of G+D products later, Director of Operations Larry Lizanich is clear about the benefits. In a brochure summarizing the case, he says, “We chose G+D because we appreciated their service excellence. Our count room runs smoothly, and that helps us stay within budget and keep our employees happy.”

The cash-in-transit business is similar in that it too relies on taut operations. Marginal gains in efficiency unlock huge value for all stakeholders. Chicago-based CIT services and armored truck player Davis Bancorp partnered with G+D in a trial of its new Bander Delivery Module for the BPS^® C5. The module automatically bands and labels the most common denominators it is sorting. For example, if it is handling lots of $5 notes in a particular shipment, it will band them together. This makes the task of the operator much easier, with gains that accrue down the line in terms of productivity and time saved. The trial went well for all concerned. “Like us, G+D wants to do things better: not just faster, but also safer and with improved processes,” said J.R. Davis, President of Davis Bancorp.

Support across the life cycle

“It is all about providing an end-to-end solution for the client,” explained Ivette Romero, Director of Marketing at G+D Currency Technology, US. This extends beyond just the hardware. G+D’s software solutions such as Compass Asset Manager, Casino Connect, and Casino CashView provide the intelligence that keeps the hardware humming. “We manage the machine across its entire life cycle,” said Bauer. “That is attractive to our partners.”

Published: 02/11/2023