With the recent announcement that cash-in-transit (CIT) heists have increased by around 70% in the past year, South Africans could be forgiven for thinking they live in a war zone.
Add to this the pressure retailers are under to deal with the enormous amounts of cash they collect each day and the problem is exacerbated.
According to Richard Philips of QD Group, the broader cash security problem is not an issue unique to South Africa as even countries in Europe suffer from the same scourge, some at a higher rate. Philips believes that the increase in crime is forcing changes in the industry that will see companies and banks adopting new technologies and processes to reduce the number of people that have to handle cash and in so doing discourage crime.
Philips explains that central to a safer cash handling and transport industry is a change in the way banks view cash. Cash is now an essential commodity banks are pursuing, and, as a commodity within a free market system, the cost to the consumer is decreasing all the time. The weak security link in this scenario is the vulnerability of cash while in transit and also while in the retailer's possession.
What is being done?
Following cash-handling trends in Europe, we may soon see banks offering their expertise in dealing with it by providing an end-to-end solution, which will see the institutions taking control of the cash at the retailer's premises. This does not mean having a branch of every bank in every retail store, but the implementation of new technology that counts and verifies cash in the store and then secures it until delivered to the bank.
The immediate impact of this will be to reduce the risk retailers face and should consequently allow banks to insure the security of the cash for a lower rate. It will also provide the banks with a mechanism to contract with retail customers in offering realtime value with respect to cash handling and the security thereof.
Five years ago, for example, the retailer carried all the risk (and high insurance premiums) as it moved cash from the store to the bank. Cash was not safe until it had been delivered and accepted by the bank. Philips says the new CIT processes will go a long way to alleviating this risk.
As an example, Philips refers to the traditional cash handling at retailers: At various times of the day, tellers take the cash from their tills and hand it over to a manager who counts it with them and issues a receipt. Later, all the cash collected is once again collated into bags or boxes for the CIT company to collect -exposing large sums of cash at any one time. The CIT company then takes it to its representative at a bank where it is checked again and eventually deposited at the bank. Only then is the bank responsible for the money.
Of course, there are alternative scenarios to this, but the process is much the same in all cash-heavy industries. Philips suggests that, using new technology, a substantial portion of this process can be automated, cutting out much of the human interference and weak links.
Tellers, for example, could take their cash to a counting machine that would count the money they put in and issue a receipt. At the end of the day (or whenever the company wants to send the cash to the bank), a collated report can be issued, identifying each individual deposit and breaking it down to what notes and coins were received, as well as an overall report on how much money is in the secure device.
A tamper evident bag or self-sealed, protected container will hold all the cash, preventing anyone from accessing it until it gets to the bank. Any attempt to open the container can release any number of security devices, such as dye, that will make notes unusable.
Today's technology ensures these devices are accurate, and by cutting out extra cash handling (which exposes cash to potential thieves), the risk of loss is lower. Using a barcode container tracking system, the risk is further lowered as the CIT team could simply scan the container on collection, electronically registering everything the store and bank needs to know and simply drop it off directly at the bank where a barcode scan will accept the delivery thus giving rise to increased productivity and greater accuracy within the CIT logistics chain. Nothing else needs to be done.
These changes allow banks to assume responsibility for cash long before it is delivered because they automate much of the cash handling and transportation processes, remove human interference and some of the risk. The result is a process that is harder for thieves to circumvent and easier to insure. It will also relieve retail management of the cash-handling chore, something Philips believes will free up hours of management time each day that can be spent focusing on the retailer's core business instead of handling cash.
Of course, these measures are not foolproof in a society with very innovative criminals, but they make the process of stealing much harder, the rewards lower (what can one do with dyed notes except go to a casino) and the potential of being caught higher.
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