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New Report: THE FUTURE OF CASH 2008

Cash still the most widely used payment instrument but requires greater efficiency in supply chain management policies

PARIS, 1st of May 2008.  According to a new report by AGIS Consulting & commissioned by Scan-Coin & Innovia Security, the continued use of cash in the economy will require all stakeholders involved in the cash supply chain to improve productivity of cash processing & increase the efficiency in delivering cash to merchants & consumers.

Since the euro was introduced in its physical form on 1 January 2002,  circulation of banknotes has grown by 75% to reach €677 billion at the end of 2007, surpassing the dollar as the world’s premier currency.

The proliferation of new payment instruments such as the payment card are challenging cash with competition particularly intense in the low value segment.  However, cash represents 8 out of every 10 transactions,  remaining the most widely used payment instrument in the eurozone.  Changing payment behavior is proving to be a slow process despite the rise in new forms of money such as virtual currencies and loyalty programs.

According to the report,  growth in cash is driven by 3 key factors:

• Hoarding: replenished cash stocks following the euro changeover in 2002
• International use: the euro has become the second global currency after the dollar with increasing use by non-residents of the eurozone.
• Low-value transactions: cash remains the most efficient and convenient tool for small payments.

As payments providers are focusing on economies of scales and attempting to increase transaction volumes, the cost of cash handling has been reduced with the industrialisation of wholesale cash handling and the automation in the distribution of cash.

The report goes on to say, greater efficiency can still be reached throughout the cash cycle, which should occur with the implementation recycling framework. Furthermore,  supply-chain management policies should focus on further integrating the various actors of the cash cycle.

View report:
The Future of Cash: 2008 (PDF) [ENG] [FR] [ESP]

For more information, visit http://www.agis-consulting.com

AGIS Consulting is an independent strategy consulting firm, specialized in retail payments, including cash, cards and other payment instruments.  AGIS aims at providing its clients with out-of –the box thinking, in order to anticipate the changes in the market and develop customised value-added solutions.  Clients range from financial institutions, to payment service providers, to soft and hardware vendors.

SCAN-COIN:is one of today’s leading suppliers of cash processing solutions.  The expertise of SCAN COIN as a  full-service partner has evolved to serve five main business segments – banking, retail, CIT/cash centres, public transport and gaming & amusement.  Today, SCAN COIN is an international group with direct operations in 14 countries and a network of distribution partners covering a further 100 countries.  The company offers a comprehensive range of hardware and software solutions for coin and note handling.

INNOVIA SECURITY & SECURENCY
Innovia Films, a specialist polymer film maker & manufacturer of the Clarity range of security films. Innovia Films provides Securency International (joint Innovia & Reserve Bank of Australia partnership) with the unique BOPP formulation used for development of Guardian®, the innovative polymer substrate for banknotes. First adopted in Australia in 1988 for their bicentennial commemorative $10 banknote,  Guardian® has since been adopted for the whole Australian note series as well as in New Zealand, Brunei, Vietnam and Romania.