NEWSLETTER OF THE INTERNATIONAL BANKNOTE DESIGNERS ASSOCIATION JUNE 2021 // ISSUE N° 21

Substrate — CONTENTS

special section 02. INTRODUCTION

» Editorial IBDA
» Message from the President

05. DESIGNERS NEWS

» Banknote Designers — Creating the
Future Through New Techniques...

16. HUMANIA CURRENCY

» Post Covid-19 initiative by the IBDA

32. SPOTLIGHT —
» Interview with Alan Newman/De La Rue

35. SUBSTRATE —
» Special section

69. IBDA NEWS

» 6th IBDC — Virtual Conference

81. THE END OF CASH —

35. » Special Covid-19 section

SPOTLIGHT INTERVIEW 6th IBDC – VIRTUAL CONFERENCE

Interview with Alan Newman, Product Director, De La Rue International Banknote Designers Virtual Conference
READ MORE 32 34 READ MORE 71-75

HUMANIA CURRENCY TECHNOLOGY NEWS

A GLOBAL CASH COMMUNITY Initiative to Support Human Recovery The latest innovations available to the banknote designer
& Development Post Covid-19 READ MORE 16-31 READ MORE 79-80

16. 79.
info@ibd-association.com www.ibd-association.com
02. EDITORIAL

EDITORIAL

Light at the End of the Tunnel

“The light at the end of the tunnel is not an illusion. The tunnel is.”

Tunnels are a symbol of hope because no matter how dark it gets

inside the tunnel, you know that there is going to be light at the
end of it. It seems like the past 15 months have been like finding
our way through a very long and dark tunnel and only recently
have we begun to appreciate the light at the end of it, symbolizing
hope and inspiring us to move forwards.

Looking back at the Covid-19 era and the associated confinement

measures, it all seems like a haze or a dream where our basic
liberty and freedom was stolen away. While we all knew this was
for a good reason, to protect us, we also knew it would change
things in a way we could not control.
For many of us, this was perhaps the single biggest challenge –
not being able to do all the things we previously took for granted.
And now that the light is clear and visible at the end of the tunnel,
have we learned to appreciate even more the very basic things
in life?
As a global community, connected by friendship, sharing, respect
and our very own humanity, we have all suffered a great degree
of disconnect since early 2020. This has had an immense impact
on our personal and professional lives and brought uncertainty
and instability into our world. As humans, we do not function very
well when we are confronted with such uncertainty and without
direct contact with our support network, the emotional impact
was even greater.
The real danger with disconnect is a feeling that we are on our
own; that the world is moving on without us and that things will
never be the same. Isolation blinds us to the fact that actually we
are all going through the same thing and experiencing similar
emotions and that at the end of the day we are connected by our
day-to-day experiences without even knowing it. Covid has dis-
tanced us from each other but it has also brought us closer: very
soon we will all have the chance to meet again and reconnect on
an even more human and real level than before.
My wish for the IBDA and for our community as we move towards
the light at the end of the tunnel together, is that we embrace our
sense of community and never forget how important this is for us
all to be happy. Happiness comes with sharing; sharing our sto-
ries, our successes, our failures, our sadness and our humanity.
As the light at the end of the tunnel gets brighter and brighter, I
encourage you all to make that final leap and reach out to each
other… Act like a true community and help each other leave the
darkness behind.
The IBDA is your association and not just about design or bank-
notes. It is first and foremost about people and today, more than
ever, we must remain a strong and united community and help
each other.
I have a feeling that when we all meet again, we will know deep
inside that even though during all these months, the light at the
tunnel seemed very distant, it was well worth the journey to get
to it and leave the darkness behind us.
Looking forward to that moment

Perhaps my biggest feeling of happiness in my work at the IBDA Best wishes

is when our community comes together. The energy, passion and
joy felt when we meet and exchange is simply irreplaceable. It is Vanessa Lavie
a magic moment and even though it only usually lasts for a few IBDA Insight Editor
days, the sensations remain for weeks and months afterwards.
We desperately need to feel this again and we all must make the
effort to reconnect and start exchanging. This will happen but
each one of you must be the spark that gets the fire going again.

02 ibda INSIGHT 21

MESSAGE FROM THE PRESIDENT
Message from the President
A Time for Change – Design as an Enabler of Innovation
In view of the current market conditions and the rapidly evolving
global payments landscape, the IBDA recognises that many or-
ganisations will be questioning which industry association can
support them most during this period of great change. More than
ever, the banknote community needs to maintain and improve the
level of connectivity and exchange between different stakehold-
ers and actors in order to address the new challenges and forces
shaping the evolving payment ecosystem.
We are currently addressing this issue directly within the IBDA
and assessing the need to widen our scope of activity to embrace
the significant changes in payment trends, technologies and mar-
ketspace innovators.
When we created the IBDA (2010), the global payments landscape
was a very different place, within which cash enjoyed a well-de-
fined marketspace and our mission was to support the global
cash community by bringing industry actors together in the pursuit
of excellence and innovation in banknote design. Together with
our industry, we have achieved much since our inception and
much of our success was based upon addressing highly relevant
and time-critical issues as they emerged.
We can summarise much of our activity during the period 2010 –
2020 as fostering, supporting and promoting ‘DESIGN INNOVA-
TION’.
Today, the global payments ecosystem has been transformed to
a point that a whole new set of actors, technologies, challenges
and trends are emerging. The main drivers behind such change
include:
1. Central Bank initiatives to improve payment/transfer/settlement
efficiency
2. Changes in Legislation & Regulation
3. Technology Evolution
4. Cash weaknesses (Access/Friction of Use/Cost/Remote
Payments)
5. Precise Analytics & Life-Cycle Assessments
6. Crypto currencies and CBDC
7. Big Data Infrastructure & Data Decentralisation
8. Public Choice and payment habits
9. Covid-19 & non-cash payment technology uptake
10. Regional polarization of cash usage
ibda INSIGHT 21
MESSAGE FROM THE PRESIDENT
Banknote design and the inputs that feed and facilitate informed
design decision-tmaking can no longer ignore the great wave of
change sweeping through the payments ecosystem. We cannot
act in isolation, immune to such changes, believing that we can
continue to operate as we have in the past. If we do, we will fail
to understand and achieve the immense pool of new opportuni-
ties that exist in this constantly emerging and evolving payments
landscape.
If we look back at how FINTECHs revolutionized digital payments
since 2008, we can see quite easily how a dated ecosystem can
be completely redefined and reinvented, ultimately bypassing
traditional actors such as commercial banks and established
payment service providers.
As CASHTECHs now enter the physical payment arena, significant
opportunities exist to address the key weaknesses of cash and
ensure a sustainable future for banknotes. The combined impact
of FINTECH & CASHTECH on our industry will be far greater
than the introduction of other payment tools such as credit or
debit cards. These new actors can either innovate with our in-
dustry’s support or without it... they certainly won’t wait for us to
decide in order to achieve their own business goals.
It is clearly in our interest to embrace, understand and include
these new actors in our community. We need to explore and dis-
cover new ways of moving, accessing and using cash in existing
and new marketspaces. We cannot simply base our vision of the
future on the past. New technology coupled with new actors can
quickly become a disruptive force or a positive one, depending
on how we position ourselves in this new arena.
» FINTECH is the technology and innovation that aims to compete
with traditional financial methods in the delivery of financial banking
and payment services by using technology to:
› improve activities in finance
› Improve accessibility to finance & banking services
› Reduce costs/improve efficiency in banking services
and payment
› Create a new model of how banking services and pay-
ments can be executed
» CASHTECH is the application of technology to how cash is ac-
cessed, used and recycled. It uses technology to
› fill the gap created by a decline in traditional cash infrastruc-
ture, fewer bank branches, ATMs and cash centres.
› build upon the specific attributes of cash which digital
alternatives cannot match
› connect those who have cash with those who need it
› make all steps in the cash cycle more efficient and frictionless
03
MESSAGE FROM THE PRESIDENT

Virtually everything happening today in the global payments
marketspace will eventually have an impact on currency design
but the bigger issue is how to have an impact on this marketspace
via currency design and how to link design to the new requirements
of this ecosystem. The interoperability, scalability, convertibility
and of physical and digital payment tools must now become a
priority when designing for this new payments environment. The
co-existence of cash with emerging digital technologies and the
potential improvement in cash circulation efficiency, access and
cost can only be achieved by understanding the new technologies,
infrastructure. This is our new challenge and the IBDA wishes to
facilitate the development of a new payments model by supporting
knowledge development, experience sharing and multi-party di-
alogue within our community.
The IBDA sees this new chapter in our evolution as a positive and
inevitable evolution in what we have been doing since 2010. We
aim to report to all our members on our research in these new
fields throughout 2021 and solicit your approval for broadening
our scope of activity to ensure that design remains a core asset
in any currency development project and to explore how design
can act as a facilitator of innovation.
We trust that you will see both the logic and absolute necessity
for us all to develop a greater understanding and appreciation of
all the moving parts in our evolving payments ecosystem and play
a pivotal role in supporting the cash industry to reconnect and
engage during these times of great change.

This process will involve bringing more and new parties to the
same table and but this is the only way we can gain a better ap-
preciation for and understanding of what is possible in the future.
Currently, no organisation or association is addressing this critical
space where physical cash, digital currency and their related and
interdependent ecosystems overlap.

This space is the future for all of us and has yet to be defined.
We must bring all stakeholders to the same table and develop a
common vision for a future payments ecosystem where user
choice, efficiency, access, interoperability and exchange are a
priority.

For just one moment let us think about changing direction a little.
While continuing our good work in the area of ‘DESIGN INNOVA-
TION’, let us now consider ‘DESIGN AS AN ENABLER OF INNO- Mark Stevenson
VATION’... This may be the key to our future and our future will IBDA President
involve new innovators. So logically, for all of this to work, we
788must get to know these innovators, how they work and what
their vision of the future is. We may ignore them to our peril or
embrace them to our advantage.

04 ibda INSIGHT 21

Madlé meets Merklas
Aricle by Inge Madlé – Madlé Design
I
t is 2020. The world is silent.
The Covid-19 pandemic forces
us to stay safely at home. Our
only ways of connecting are
through smartphones and com-
puters, while we hope and wait
for better times to come. Out of
curiosity, I google a name from
our family tree. Václav Merklas.
Google’s algorithms help me
find every website with infor-
mation. The name is one of many from the family tree my father
created in the ‘90s, with patient research in every available official
register. It makes me think how easy it is to find a wealth of infor-
mation on the internet, and how challenging this would have
been in the past. Usually, it was only written down when you were
born, got married and when you died. Maybe your biggest
achievements were mentioned somewhere if you were a person
of influence. So imagine my surprise when I discovered that I
share a passion and career choice with one of my ancestors. The
choices we make in life, the things we enjoy - perhaps they are
more determined by our genes than we think.
Art trip
Knowing that my great-grandfather Václav Merklas (*1809) was an
important engraver and pioneer in the field of maps and globes, is
a gift! I am so grateful when I read about his life and about his
descendants, especially my grandmother (*1899). How did they
earn a living with their arts and crafts? I was even able to obtain a
few of his original prints through an-tiquarian bookshops. And as
I’m writing this I have a box in front of me, filled with drawings as
well. It is the perfect moment to take a look back in time and to
create a visual tale about art and crafts in one family.
Václav Merklas
*1809 Prague – + 1866 Troppau
Cartographer, engraver, globe maker, printer and pioneer
Craftsmanship
Václav Merklas was born in September 1809 in Prague, as
Michael Wenzel Merklas. He graduated from high school in his
hometown and went to study law. But he did not last long as a
legal intern in court, and soon transferred to art school. After
graduating he set up his own printing house where he devoted
himself to his favorite field: artistic copper engravings.
At first, he mainly painted and engraved pictures of saints and
published print collections of engravings of Prague cityscapes.
But soon his focus shifted to the compiling, engraving and pub-
lishing of Czech maps and the printing of geographical atlases.
ibda INSIGHT 21
05. DESIGNERS NEWS
Between 1837 and 1853 he published eight atlases mainly for
school use, and at the Matice Ceska publishing house he com-
piled and published a map of the Czech Lands (1846) and a globe
accord-ing to the latest division (1853).
One of Merklas’ most important works is the Atlas of Natural Ge-
ography from 1843. Even though it wasn’t fully completed, it be-
came the standard for school atlases at the time and for the first
pocket atlas in 1853.
The pioneer
In Prague he married his second wife, Anna Lattová. With her he
welcomed four children in the period 1841-1851, in the same
period he started both his printing house and a small globe man-
ufacturing including sales. By the late 1840’s Merklas printed
and developed small terrestrial globes. In all probability, he built
the very first globe of Czech in early May 1848.
He received financial support and collaboration from his friend
Jan Felkl to introduce the first production of globes in Czech. This
cooperation along with Merklas’ experience in printing and his
extensive network became the foundation for the company
FELKL&Sons, specialized in globe production.
However, shortly after the birth of his last child in 1851 Merklas
decided to move his family to Levoca, Slovenia to start a new
life. He sold the printer and left his globe company in-cluding
equipment to his associate Jan Felkl. Due to Felkl’s exceptional
skills he estab-lished a unique and prosperous business.
FELKL&Sons influenced the quality of teaching aids as the largest
globe manufacturing company in the entire Austro-Hungarian
Monarchy in the second half of the 19th and early 20th century.
Mission
After the Austrian education reform, in 1852 Merklas passed the
state exams in History and Geography. In Levoca he worked as
a teacher at the local grammar school and de-voted himself to
artistic carving and painting. He painted numerous cityscapes of
Levoca during this time. He was also invited by the parish church
(Basilica St James) to renovate their Gothic altar with a confes-
sional. He published books from 1846-1860, which are in
possession of WorldCat libraries.
After ten years he returned to Prague in 1862. A decision by the
Ministry of Culture and Education on January 10, 1864 sent him to
a teaching position at the grammar school in (Troppau) Opava. At
this school Merklas taught German, History and Czech. Together
with prof. Antonin Vasek he published the Opavsky besednik and,
later, the Czech calen-dars ‘Messenger from Moravia and Silesia’.
05
DESIGNERS NEWS // INGE MADLÉ

During the Prussian-Austrian war, the region of Silesia became
one of the battlefields. When Opava was occupied by the Prussian
army they brought with them a cholera epi-demic. On October 1
1866, Merklas’ second wife Frantisek succumbed to the disease.
A day later Václav himself also passed away. They were buried
together in the Opava cemetery.
In 2017, the Faculty of Science in the Charles University in
Prague painstakingly digitized the entire Merklas map collection
as part of the FELKL & SONS collection of globes and maps -
the largest in the world. With a book, an exhibition in 2019 and
the digitized works they made the Merklas legacy available for
future generations.

Legacy
Merklas was of great importance to the Opava Grammar school.
Even today, he is listed on the website as important people for the
city of Opava. His legacy is honored by a memorial plate (placed in
1966) and an exhibition for the 145th anniversary of his maps and
atlases, at the lobby of the Cadastral office in Opava (in 2011).

06 ibda INSIGHT 21
 DESIGNERS NEWS // BANKNOTE ART CONCEPT™

Banknote Art Concept – A new non-profit initiative

for Money Art, Art Fiduciaire and Banknotes

“Money art is an artistic interpretation through a cultural and socio-historical perspective that
illustrates and transforms the concept of banknotes and coins.”
Carlos Almenar
TM

In 2014
of art. He realised currency was given an added value different to its primary role as a cash instrument.
It was coincidental that he observed a Venezuelan banknote which he designed, was converted into a
piece of art sublimated under the term “Money Art” by artist José León.

clear references to explain exactly what the concept was, however he found several visual references of

Following his fascination and interest in artists using money as a medium to create art, Carlos
discovered more artworks showing various skills and techniques, such as collage from artists like José
Catamo, Justine Smith and Philippe Assalit.

In 2017, Banknote Art Concept™ was created with the

idea of bringing together a collective of designers and artists
who are connected through using currency within their artistic
designs, journeys, and creations. The primary principle of the
project is to acknowledge the artistic value of banknotes and

economic symbol to symbolic works of art that are proudly

exhibited in publications, social media, museums and galleries
worldwide.

2020 will be remembered for challenging times as well

extremely constructive for the Banknote Art Concept™ team
where they were able to focus on the development of this
project and cultivate the project into reality. Thus began a new
chapter in this story, with four passionate individuals creating a
vision: to enhance the artistic value that artists and designers
give to banknotes and coins.

Banknote Art Concept™ is an initiative that brings together

creative professionals in art, marketing and communication,
sharing the same spirit and philosophy to communicate,
educate and share experiences related to money art and art
engraving.

Our focus on the artistic transformation of money into art with

the emphasis on art rather than the use of technology and
elaboration of the currency.

Our goal is to create a network of people connected with money

art (aesthetics related to the subject of coins, banknotes,
security ink, etc). Under the slogan “Art is our currency,” we
want to bring together all creators who use money in their visual
» Colon, Costa Rica, série Banknotes Portraits du Monde 2021
and/or artistic portfolio.

ibda INSIGHT 21 07
DESIGNERS NEWS

» Cultural collage, paper & polymer banknote, 2021

©© Carlos Almenar
Carlos - Australia.
Almenar - Australia.

Our values enables us to promote and curate the cultural dimension of banknotes and coins, from the
artistic research at their creation, necessary for the economic functioning of a society, to their repurpose
    
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necessities and comforts. The use of art in various political and social issues to organise campaigns and
             
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»Niñas con máscara/Niñas Diosas, 2020.

Billete de $1000 pesos desmonetizado.
© Gabriela González - México

08 ibda INSIGHT 21
 DESIGNERS NEWS // BANKNOTE ART CONCEPT™

                
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around them to gain understanding, build communities, and their thoughts on diffferent
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interpretations,     The banknote designer is a creator
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value beyond being purely economic, that is the artistic-cultural value.
                
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The banknote design

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the design must be nourished by
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 addressing the design
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© Carlos Almenar - Australia

ibda INSIGHT 21 09
DESIGNERS NEWS // BANKNOTE ART CONCEPT™

              
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 symbolism fer
  
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reality.
            
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of banknotes must be subject to three
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thoughts that describe cultural and social values, that is to say, human perception.

Hyperrealism painting allows me to

explore reality far beyond what we
perceive. My artistic proposal is to
“give a new value to the money”,
which only art with its magical
transforming power can do.

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» Cinco mil Kahlos » Banco Central de VVenezuela

enezuela
Óleo en papel moneda - 188 banknote
Paper banknot e 2016 - 5000 - serie B
Our community is composed of
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Venezuela Banknote
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of nationality
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that resides in cultural diversity.

10 ibda INSIGHT 21
 DESIGNERS NEWS // BANKNOTE ART CONCEPT™

Akasegawa: The Imperfect Face of Reality

Yohann Naviere

Japanese Avant-Garde Artist Genpei Akasegawa, 1967.

Photo: © Mitsutoshi Hanaga

In thriving Japan of the 1960s, an artist decides to rebel against the

westernisation of his culture by using banknotes as his creative medium.
Post-war Japan had become the promised paradise with a growing consumerism and the promise of
a better urban life, optimism was high and prosperity was within reach. However, behind this idyllic
façade was a not-so-pleasant one: The accelerated economic recovery was a direct consequence of the
invisible alliance with the United States and a product of the Cold War. It was precisely this invisibility
that worried several Japanese artists, including Katsuhiko Akasegawa.

Genpei Akasegawa (artistic pseudonym) began his artistic career in the early 1960s. His art using
Japanese currency as a medium was symbolically intended to undermine the value of the legal tender,
injecting uncertainty into the sacred status of the banknote, revealing its illegitimacy as a protest against
the country’s increasing proclivity toward capitalism.

1963 January
During the early 1960s, high-quality counterfeit 1,000-Yen banknotes circulated widely in Japan,
known as the Chi-37 counterfeiting scandal. In January 1963, Akasegawa sent Japanese Cash
Tokyo. The invitations were a monochrome
Postal envelopes with invitations to his solo exhibition in To
reproduction of the 1,000-Yen bill depicted on the front, with information about the upcoming exhibition
on the back.

Akasegawa used copies of the 1,000-Yen bill as wrapping paper, wrapping everyday objects for a series
of artworks called “Packages.”

“Impound object : bag”, 1963, 30 x 40 x 8 cm ,

“
1,000 yen notes model, bag.
sheets of 1,000 yen notes model, bag.

©
© SCAI THE BATHHOUSE

ibda INSIGHT 21 11
DESIGNERS NEWS // BANKNOTE ART CONCEPT™

1963 March
In March of the same year, Akasegawa exhibited, as part of Yomiuri Independent, held at the To
okyo

Adversary Before Killing Him” (enlarged 1,000 Yen bill). The work consisted of a 90×180 cm ink drawing of
the 1,000 Yen bill. He also pasted on the wall life-size prints of 1,000 Yen single-sided.

© SCAI THE BATHHOUSE

1963 May
Akasegawa participated in a collaborative Yen
banknote prints were hung from the ceiling with cutting marks along a dotted line. This art piece was so
popular that visitors cut them off and they had to be replaced during the exhibition. Several works made
from individual banknotes were also presented, including an enlarged 1,000-Yen bill.

1964 January
A year later, in January, the Japanese police became interested in his prints of 1,000-Yen banknotes. On
January 27th, the Asahi Shinbun newspaper published an article about the police investigation a “young
artist and self-styled member of the avant-garde,” in connection with the Chi-37 counterfeiting scandal,
inferring that Akasegawa was involved in the counterfeiting conspiracy.

1964 February
February 24th, Akasegawa published in the Dokusho Shinbun newspaper: “Theses on ‘Capitalist Realism,”
responding and presenting his theory after months of experimentation questioning the order of reality
highlighted in the Asahi article and the intimate interaction that “real” money has with people.

He pointed out, “Even if we know intellectually what the monetary system is, the ‘perpetrator ’ – the
currency – constantly overshadows us, clings to our work and our actions like eyelids to our bodies, and
before our eyes sneaks into our wallets/our beings and, aided by the speed with which it circulates despite
our wishes, without time to look it in the face, wraps us in the long rope it drags.”

Akasegawa explained that his own printed banknotes were imperfect money semblances. Neither real nor
fake and with no intention, nor potential to be used as money. In his view, they fall under another term:
“models”.

Police ruled out his connection to the Chi-37 counterfeit, however he was charged with “creating imitation
banknotes,” and then “currency simulation,” which, while different from counterfeiting, still constituted a
violation of the law, based on his partial reproduction of the 1,000 Yen bill.

Thus began a trial that would last several years.

12 ibda INSIGHT 21
 DESIGNERS NEWS // BNAC™

1,000-Yen
1,000-Yen Not
Notee Trial:
Trial: Catalogue of Seiz
Seized
ed
Works by
Works by 11,000-Yen
,000-Yen Not
Notee Incident R
Round-
ound-
Table Conf
Table Conference
erence (1967)
Gallery K
© Gallery ojima
Kojima

1967 June
In June, Akasegawa was convicted and given a suspended sentence. Six months later, he created a
“worthless work of art” in protest of his conviction. That work, modelled after an old 500- Yen bill, shows
Imamura Tomomi’s face removed from the portrait, a central value of 0 Yen followed by a value of 000 in
each corner. The other side includes portraits of Johannes Gutenberg, Faust and Schaef efffer
fer.

Throughout the trials and appeals, Akasegawa’s artist friends used the courtroom to debate the meaning
wo issues brought to this trial were whether Akasegawa’s reproduction of 1,000- Yen banknotes
of art. Tw
constituted “art” and whether “art” was protected by freedom of expression, so it was not a crime.

1970 In 1970, Japan’s Supreme Court ultimately ruled against Akasegawa. Although his work was considered
“art,” producing that “art” also constituted a criminal act.

Akasegawa dubbed the whole incident as the “Thousand Yen Bill Incident”, vindicating it and considering
the whole political debacle as part of his artwork.

““Aimaina
Aimaina Umi 12”
12”,, 1961 35.7
35.7 × 25.0cm,
25.0cm, ink
paper.
and collage on paper.
© SCAI THE BA ATHHOUSE
THHOUSE
BATHHOUSE

ibda INSIGHT 21 13
DESIGNERS NEWS // BANKNOTE ART CONCEPT™

Epilogue
“Anti-art” as a defence of identity.

Akagesawa is recognised as a critical and exceptional artist in the Japanese avant-garde

movement and contemporary art world. He was an award-winning novelist who crossed over into
the broader realm of popular culture.

+LVZRUNLVLGHQWL¿HGDV³&DSLWDOLVW5HDOLVP´DWHUPXVHGLQ-DSDQDQG*HUPDQ\GXULQJKLV
time. Akasegawa participated in a broad movement amongst Japanese artists called “Anti-Art”,
deliberately avoided the terms “art” and “works of art” to describe his works, preferring to use the
term “models”.

Akasegawa is a Money Artist who used Japanese

banknotes as a means of protest, a vision he
strove to defend. His works are shining examples
of how Money Art can be used to reinvigorate
identity and culture.

www.banknoteartconcept.com

14 ibda INSIGHT 21
 DESIGNERS NEWS // BANKNOTE ART CONCEPT™

talent in pursuit of a goal

OUR TEAM

BAC is a non-profit initiative, sustained by

the volunteer work of its founders:

Carlos Almenar Héctor Mazzarri

FOUNDER CEO MARKETING & COMUNICATION

Senior Banknote Designer, Journalist with more than

Contemporary Artist and 20 years of experience in
Journalist with more than content curation, branding
25 years of experience. and visual communication.

www.linkedin.com/in/carlos-almenar-61031bb5/ www.linkedin.com/in/untallhector/

Carol Franklyn Yohann Naviere

CONSULTANT EDITOR PROJECT STRATEGY & RESEARCH

Educator with more than Project Strategy, Research,

30 years multidisciplinary Marketing and Analytics
experience. Specialist with more than
15 years of experience.

www.linkedin.com/in/carolfranklyn/ www.linkedin.com/in/yohann-n-757207b0/

www.banknoteartconcept.com

ibda INSIGHT 21 15
DESIGNERS NEWS // HUMANIA
HUMANIA
What is HUMANIA?
The COVID-19 pandemic is the first truly global crisis. Beyond
the loss of life, there are numerous far-reaching consequences
such as human seclusion, suffering, economic distress and a
sense of helplessness. COVID-19 is changing things on a per-
sonal, professional, social, economic and simply human level. We
believe that it is our responsibility as a community, to respond to
this new world in an inclusive, positive and collective fashion. We
must leverage our strengths, sense of humanity, and solidarity to
do some good.
The global cash community has already reacted to the ongoing
crisis and consequent hardship being experienced by societies
around the world. A diverse number of individual initiatives,
driven by community members, are underway and making a real
difference for millions of people. HUMANIA is a global platform
for us to work together and through our collective efforts, achieve
more than as individuals. By pooling our resources, reach, com-
petencies and willingness to help, we can have more impact on
a local scale (where it is needed most) while leveraging the
assets that exist within our community globally. One may simply
think of HUMANIA as a way of channeling support from those
who can and want to help, to those who need it most.
HUMANIA Partners
CashEssentials
16
HUMANIA Objectives
HUMANIA is all about restoring hope and supporting the people
in society who have been most affected by the Covid-19 pan-
demic in their efforts to recover and rebuild. HUMANIA aims to
achieve this by:
♥ Raising funds and awareness to support post COVID-19 re-
covery.
♥ Paying tribute to those who have been in the front line during
the fight against the pandemic.
♥ Demonstrating that cash connects people in a crisis situation
thanks to its unique attributes:
♥ UNIVERSALITY ♥ RESILIENCE ♥ TRUST
How Will HUMANIA Help?
The diversity of our community is our strength. Most of us already
have ideas about how we can help others who are suffering
during this crisis. These ideas will most likely be specific to your
region, culture or scope of operations. HUMANIA will empower
you to convert your ideas into reality and gain the support for the
global community. Every idea, no matter how big or small, merits
consideration. What really counts is our willingness to do some
good for those who need your help. Our social responsibilities
extend beyond the places where we live and work to the actual
people who depend on cash to survive, exchange and simply
exist as fellow humans. HUMANIA is the global cash community’s
social responsibility platform allowing us all to engage, contribute
and ‘give something back’ to our world.
How can you Help HUMANIA?
Create a HUMANIACURRENCY Design
You don’t need to be a professional designer, not to mention a
banknote designer to create a HUMANIACURRENCY design. At
its very essence, HUMANIACURRENCY is about enabling you
to tell your story by capturing a moment in time from the COVID-
19 pandemic and depicting it visually in the form of a banknote.
HUMANIACURRENCY designs will not actually become or re-
place circulating currency so you have a great deal of freedom
and latitude to create a piece of artwork that respects the simple
project design guidelines. Your design will help us remember and
celebrate those special people who demonstrated an exceptional
degree of courage, humanity and solidarity and directly contribute
help us achieve our goals.
You can register right now to participate in the HUMANIACUR-
RENCY Design Initiative by visiting: ➲ WWW.HUMANIACUR-
RENCY.COM.
ibda INSIGHT 21
 & & & & &&
                
                  
               
DESIGNERS NEWS // HUMANIA

   
                 
         

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& & &

              

SPREAD THE WORD         HUMANIA
  Design
  &Artwork:
     
           
The more people who know about HUMANIA, the better are our To date we have received several HUMANIA design projects and
chances for success. Communication is at the very heart of the we wish to sincerely thank these people and their organisations
& & & & & & &
HUMANIA initiative and since this is the first ever Global Cash for demonstrating a true sense of social responsibility and wishing
Community  Initiative,
 we could
 certainly
  benefit  from  your help in  to give  back  to society
 by telling
 their story
 via piece of
 HUMANIA
spreading the word. HUMANIA  crosses
 all borders
  and divides;
 
artwork.         
              
linguistic, cultural, political, social and religious. It focuses on
helping those who need   it most and the more people who  en- 
The HUMANIA  initiative
   continues
  the
and  more
  who par-
people
                   
gages in and support HUMANIA activity, the more we can help ticipate the stronger our impact will be. We count on you to take
                   
others. You can help spread the  word about  HUMANIA   in
 any of  a little time to give something
  back
 to our world and at the same
the following ways: time have a little fun by visually telling a story. You can do this
alone, as a team or simply with friends and family. Your work does
♥ Make HUMANIA a part of your Organisation’s Goals in 2021. not have to be a final piece of banknote art. What really counts is
♥ Tell your employees/clients about HUMANIA. that you participate…
♥ Contact your national press and media and ask them to write
an article about HUMANIA. Join the HUMANIA initiative now by registering online at www.hu-
♥ Write an article yourself (we can help you) about HUMANIA maniacurrency.com
and get it published in social, web or print media.
♥ Distribute HUMANIA media to your contacts, colleagues and Here are some of the HUMANIA designs received to date
friends.
♥ Promote and visit the HUMANIA Design Expo in 2021.
♥ Tell others about HUMANIA collectables and outputs.
♥ Encourage others to procure & offer HUMANIA banknotes
and collectables to their employees/clients.

ibda INSIGHT 21 17
DESIGNERS NEWS // HUMANIA // SICPA

SICPA HUMANIA specimen

Title: Organic Algortihms
Designers: Sebastian Freuler & Gregory Syrvetv

The HUMANIA specimen alludes to current social issues that have

arisen during the pandemic. With the rise of digital communication
and social distancing, we seem to be drifting away from the
human experiences and connections we knew only a year ago.
The specimen questions the essence of our human experience
and how it is changing. Two faces stare at each other through
polymer windows connected through the web of geo-localized
information: a two-faced society, the self and the digital self. Our
human DNA merges with information gathered through ever-ex-
panding digital webs that simultaneously bring us together yet
distance us from one another.

18 ibda INSIGHT 21
 DESIGNERS NEWS // HUMANIA // SICPA

Front

A collaboartive banknote design by

for the 2020 HUMANIACURRENCY
Design Initiative.

--------------------------------------------

SICPA SA

Sébastien Freuler
Gregory Syrvet

LEONHARD KURZ Stiftung & Co. KG

Reto Karrer

--------------------------------------------
Reverse
Security features:

Double-sided intaglio

SPARK® FlowTM DIMENSION Openform

Green to Blue

AKOYA® Iridescent inks

KINEGRAM® Patch with KINEGRAM

ZERO.ZERO® Technology &
KINEGRAM COLORS® (Reverse Side)
KURZ THREAD with KINEGRAM COLORS®

or KINEGRAM® Stripe
with KINEGRAM COLORS®

Substrate: Polymer

Reverse

A collaboartive banknote design by

for the 2020 HUMANIACURRENCY
Design Initiative.

SICPA SA

Sébastien Freuler
Gregory Syrvet

LEONHARD KURZ Stiftung & Co. KG

Reto Karrer

--------------------------------------------

UV RGB Fluorescent inks

ibda INSIGHT 21 19
DESIGNERS NEWS // HUMANIA // INDEPENDENT CURRENCIES
INDEPENDENT CURRENCIES specimen
Title: SINCERITY
Designer: Tom Badley
SINCERITY
It would be a bold claim that it is possible to
encapsulate the diversity of experience in one
small piece of paper. A single designer’s own
cultural experience will always create bias, and
after that, any attempt to clearly summarize
Humanity becomes reductive, or cliche, or overly
scientific (think of the plaque attached to the 1972
Pioneer 10 space module).
Depicting Humanity’s shared experience in
reference to Covid-19 creates another challenging
layer. The actions of governments’ response have
been met with every reaction: from complete
acquiescence, to violent backlash. Regardless of
the politically correct perspective, any cash
product that is not sympathetic to the public’s
diverse experience is doomed.
Therefore, the challenge with this project was a
process of elimination. A political message was
out of the question, because it is divisive by
definition. After politics, I was forced to consider
both the meaning of cash as a payment method,
and to carefully consider the possible positive
outcomes of the Covid-19 phenomenon. The
word I arrived at is “Sincerity“.
I consider cash to be the most sincere of
payment methods: it is sensory, engaging us with
touch and visuals; it is face-to-face, local; the
point of exchange is more than financial, it is
Human.
The Covid-19 situation is in flux; what was
relevant yesterday may not apply today.
Government decrees are changeable, and the
global citizenry is experiencing a huge diversity of
outcomes. I was left with the question: what is the
commonality? Again, sincerity was the word that
called to me.
Through Covid-19, almost all Humans have
been forced to look at the sum total of their life
decisions, and to ask: “is this what I want?” In the
absence of previous life obligations, in the space
of isolation and loss, each is called to answer their
heart’s desire: many have migrated, changed
jobs, developed new skills, left their families,
rejoined with their family, repatriated themselves,
or have formed new family structures based on
shared beliefs.
20
Therein begins a journey of personal
introspection that is quietly yet powerfully taking
root in the world. This idea is a call to review
Covid-19 through the eyes of the future: perhaps it
will remembered as the first of many triggers that
forced the world to live with more sincerity, where
life’s decisions are made intentionally, according
the heart.
My design is purposefully absent of Covid
imagery, and instead features a seated meditating
figure: a universal symbol of quiet introspection.
The Humania logo eminates from the figure’s
chest. Green is the predominant color, again
symbolizing the heart. This is a reference to
Eastern philosophy, though through global
interest in meditation practices, this symbolism
isn’t localized to the East.
The theme is mindfulness, a return to stillness,
regardless of the chaos of the world. This offers
a clear image that is freely available to all, in spite
of any limitation or personal situation each
experiences.
The figure is surround by patterns, resembling
DNA structures, interchangeable with steel rope
- symbolizing the universailty of the Human
genome, and biological strength.
FAMILY / HOME SCHOOLING
The enduring image of Covid-19 will be the
homeschooling phenomenon. For me, this
encapsulates the theme of sincerity, and will be
relevant far into the future.
While the meditating figure on the front offers
the ideal, homeschooling has become the reality
for millions of families. Whereas before, the
children were conveniently dropped at school in
the morning, and the parents were compelled to
their place of work. The collapse of both worlds
into one has forced both parents and children to
question their role, their ability to perform, and the
function or disfunction of their own family unit.
Before Covid, each was occupied by a
constant stream of busy work, given to them by
superiors - be it bosses or teachers - now both
parents and children are re-learning a degree of
self-sufficiency and restraint that neither was
prepared for.
ibda INSIGHT 21

The modern format of the ‘school’ grew out of
the a need to remove abandoned children from
the streets in the 18th and 19th centuries. The
growing number of street children caused social
problems, such as crime. It was proposed that if
these children could be housed, fed, and given a
basic education, it would eleviate the problem and
allow them to function in society.
Over time, this became the commonplace
model for state education - a system of wrote
learning across a broad spectrum of subjects,
after which children were thrown in to the world of
habitual work.
The ‘orphanage’ became the convenient
school to leave children during the day, while the
parents worked. And through food and energy
price inflation, rising consumer debt, and the
rising cost of housing, school became a necessity
for the public, who had leveraged their work to
pay for a home.
Where is the sincerity in this situation? As this
system collapses, the whole family is forced to
question its assumptions about education, labour,
work, life’s purpose, and one’s role: sincere
questions that will change the nature of family and
schooling forever.
DESIGN CONCEPT - FRONT & BACK
ibda INSIGHT 21
DESIGNERS NEWS // HUMANIA // INDEPENDENT CURRENCIES
The potential of the situation is to force a
greater sincerity of intention in each person’s life
decisions. The orphanage - the original of the
school - existed because of an unconscious
decision to have children, regardless of whether
the parents had the resources to raise children to
feel loved, responsible and stable. The bold
decision to make new life is being radically
reappraised: in full sincerity, it is impossible for a
parent to give what they do not have themselves;
children demand the resources and attention to
create a world of love and free expression.
Then there are sincere decisions to make
regarding what and how to learn. Is it truly sincere
to learn by wrote memorization? What is actually
the lesson? If one has 24 hours a day free to learn
anything, what would it truly be?
Through homescooling, we are revising our
deepest assumptions of family, qualification, and
learning. The consqeunces this introspection will
have on the nature of education, family, work, and
of course money itself, will change the direction of
the world, forever.
– Tom Badley, March 2021
21
DESIGNERS NEWS // HUMANIA // KOENIG & BAUER BANKNOTE SOLUTIONS

KOENIG & BAUER Banknote Solutions

specimens
Title: Solving Inequality
Designers: Michelle Bonzon-Vuilleumier/Giovanni Galuffo

Humania Currency

Context

Crises bring out inequalities

The COVID-19 crisis we are going through is affecting the most fragile people in crucial dimensions
such as health spending, access to education, labor market, gender equality, etc.
As a matter of fact, it reinforces intra and inter country inequalities.
We have seen that the majority of governments were not prepared for such a health crisis, so they
would need to develop strategies to fight against socio-economic inequalities.

Strategy to combat socio-economic inequalities

It is important to prioritize policies to combat and prevent the unprecedented economic, social
and health situations we are facing at the moment.

It can be concluded that as in all major crises, ambitious political measures are needed to ensure:
» A better distribution of wealth,
» Equality of opportunity gender and
» A more humane economy for all.

Pendulum representing the dynamism of

the Newton's third law visible on both
sides of the specimen.

22 ibda INSIGHT 21
 DESIGNERS NEWS // HUMANIA // KOENIG & BAUER BANKNOTE SOLUTIONS

Our wish for this project

As a result of everything we are going through during this period, was to start thinking about what
connects us ALL as human beings.

From this premise we have developed our visual on the basis of these different strong elements:
» DNA sequence which is a unique genetic information of each human being
» Language as a tool of social communication with others
» Newton's cradle which inspired us to symbolize the concept of Action and Reaction.

Our proposal, which is intended to be inclusive, has been inspired by the Keynesian model, which
would consist of the creation and distribution of state-funded “vouchers” or “specimen” to support
local economy.

DNA : Unique genetic information Language : Tool of communication Newton's third law of motion :
Social : Connection with others Action & Reaction

All humans, regardless of their origin, social status or race, are interconnected with their fellow
human beings.
This is clearly seen through the difficulties we are going through and which separate us, but we also
see that through the many acts of solidarity and mutual aid, a new social link is being recreated,
restoring courage and faith in a better future.

“What counts is not the individual but the collective”.

Martin Luther King

Aspiration

This approach, if it were to be carried out and become part of the consciousness, would not fail
to generate other sources of progress which would be real added values for our societies.
In particular in terms of sustainable development, with the use of short circuits and local products.
As well as the consolidation of social ties, with the return of consumers to local businesses.

Humania Currency

Selected security features:

DNA & Fingerprint pattern Bubble colours and shapes: Globe / Country focused Newton’s pendulum:
Represents uniqueness of Different languages on earth/ using Humania Currency illustrate the action / reaction
each individual Esperanto / Human chain principle

ibda INSIGHT 21 23
DESIGNERS NEWS // HUMANIA // KOENIG & BAUER BANKNOTE SOLUTIONS

Humania Currency Concept Proposal on Polymer

Front side
All Processes Overview

Reverse side
All Processes Overview

We used a very strong element on the reverse side of the note which is the Newton’s
cradle and we took advantage of this regular structure and its dynamic movement to
highlight various security elements on several processes & levels, while taking advantage
of windows that offer new possibilities in terms of design but also in terms of security.
This same dynamism is also integrated on the front of the note in a very harmonious way.

24 ibda INSIGHT 21
 DESIGNERS NEWS // HUMANIA // KOENIG & BAUER BANKNOTE SOLUTIONS

KOENIG & BAUER Banknote Solutions

specimens
Title: Humanity
Designers: Phillipe Mermoud/Jérome Badan

» Humanity in a first sense refers to all human.

» It is on this sense that this project focused and developed.
» The goal is to break out stereotypes of race, skin color, etc.
» The project is focused on connectivity, interconnectivity between people which symbolizes a
human chain, knowledge, mutual aid.
» The objective being to remain neutral so that the different cultures, races can identify with it and
that no emphasis be placed on any skin color, religion or others.

Humania Currency
Selected Design features

Superposition of heads that in- The puzzle. Other connection Network, human chain, connec- Watermark. The image of fists
terconnect. The watercolor treat- symbol. tions, (continuous background). touching to symbolize the con-
ment would symbolize mixing, nection between people.
crossbreeding, miscegenation.

The bar code allows to certify that
the banknote is not a fake and
contains the information of issuing
country, the value, date of issue,
etc…
See-Through. Combination of puz- Micro Text. The letter would be Spark. Combination of puzzle
zle pieces. Connectivity between the country code (for example BW pieces. Symbolize connection.
front and back. for Botswana).

Numbering. The letter would be SUSI Flip. Fingerprinting / Unique Patch. Logo Humania Currency Security Thread.
the country code (BW for Botswana to each human
like the micro text).

ibda INSIGHT 21 25
DESIGNERS NEWS // HUMANIA // KOENIG & BAUER BANKNOTE SOLUTIONS

Humania Currency Concept Proposal on cotton based

Front side
All Processes Overview

Reverse side
All Processes Overview

26 ibda INSIGHT 21
 DESIGNERS NEWS // HUMANIA // CCL SECURE

CCL SECURE specimen

Title: The Future Opens its Arms to Us
Designer: Carlos Almenar-Diaz

The Coronavirus has left us all in dismay. A virus that has forced many of us to remain confined
and isolated for long periods. A virus that has disrupted the economies, education, culture of all
world nations without exception. A virus that has distanced us from our loved ones. A virus that
has made us reflect and change our lifestyle and how we work.
The Humania project is a journey for all of us. This initiative through art and currency design,
serves as channel that allows us to join forces, build to bring us back together celebrating and
paying tribute to people with the spirit of collective solidarity and humanity during the Covid-19
pandemic.
At CCL Secure a banknote concept called Humania Currency has been created, under the motto:
The Future opens its arms to us.
The design is conceptualized depicting the reconstruction of a new world, it is a modern concept
inspired by geometric figures and colours to represent a futuristic polymer note that opens our
imagination to the future.5 5
F F is the outlook towards a new world where society harmoniously
The message of this note
integrates with nature through
    the
  solid
  foundations of respect for our environment and our
community since we are all part of a global society.

Front and back 50 - 76 mm x 166 mm

ibda INSIGHT 21                                       27
                                      
                                       
        
DESIGNERS NEWS // HUMANIA // CCL SECURE

28 ibda INSIGHT 21
 DESIGNERS NEWS // HUMANIA // KURZ

KURZ Security Element Development

Title: KURZ Security Element Development
Designer: Reto Karrer

KURZ, the industry leader in foil security feature technology for over 30 years, approached the
HUMANIA project from a different perspective. Rather than elaborating a complete design, the
KURZ feature development team decided to support and facilitate other HUMANIA designers by
developing HUMANIA-specific KINEGRAM ® security features. These security elements use differ-
ent formats and technologies for a seamless integration into each specific artwork. Many years of
experience in designing, manufacturing, delivering and application of KINEGRAM ® patches, stripes
or threads for banknotes enables KURZ to act as a consulting team partner already at the early
stage of a banknote design project. The KINEGRAM ® platform offers unparalleled options for visual
appearance and banknote design integration, boasting a multitude of both optical security effects
as well as different technologies to create stunning visual impressions.

This approach not only added a new element to the project but fully embraces the HUMANIA phi-
losophy of working together to do some good. The KURZ team worked hand in hand with
designers to help bring the designs to life through movement and animation as can be seen from
the first sketches of individual KINEGRAM ® elements developed exclusively for the HUMANIA
project below:

Sketch 1

ibda INSIGHT 21 29
DESIGNERS NEWS // HUMANIA // KURZ

Sketch 2

Sketch 3

30 ibda INSIGHT 21
 DESIGNERS NEWS // HUMANIA // KURZ

Sketch 4

On behalf of HUMANIA and HUMANIA designers, we wish to extend a big thank you to KURZ for
providing their time, resources and creativity to make HUMANIA a success.

LEONHARD KURZ Stiftung & Co. KG

Schwabacher Str. 482
90763 Fuerth/Germany

KURZ Technology - The Essential Element

E-Mail: banknote.security@kurz.de

www.kurz-banknotes.com
www.kurz-world.com

ibda INSIGHT 21 31
32. SPOTLIGHT INTERVIEW

Spotlight Interview
Alan Newman, Product Director, De La Rue

Alan, can you please tell us a little about how you came to enter the
world of banknotes and become Product Director at De La Rue?
AN: Well it has been a long journey of 35 years, starting off at 16
years old as an apprentice in pre-press at the Bank of England, I
followed my father into Banknotes where he was a Banknote
Printer. It was a great period of learning about printing and man-
ufacturing, and in 2003 when De La Rue were awarded the
contract to print sterling currency my opportunity within De la
Rue expanded. I progressed into banknote production management,
and in 2008 moved to De La Rue Head office responsible for
Design. It was there that I shaped the importance of Design,
taking my understanding of manufacturing and blending this with
aesthetics to create functional banknotes not only for the cash
cycle but for efficiency in manufacturing. This in turn lead to an
opportunity in a new function Advanced Manufacturing Engineering
(AME) where, I took Banknote Design, Manufacturing and customer
experience to the next step, looking to automate, improve effi-
ciencies, and expediting the integration of new security features
into banknote manufacturing.
It takes me to where I am today as Product Director, which in-
cludes Currency Design, Research & Development, Product mar-
keting and Customer technical support.

Why is the subject of banknote design important to De La Rue?

AN: Design plays such a pivotal role in banknote manufacturing
and cash cycle performance. Not only does it represent visual ex-
cellence and engages interaction with the public, but it contributes
directly to efficiency in manufacturing and of course circulation
performance. As a banknote printer, substrate and security feature
supplier, design is key to effective integration.
At De La Rue we’re continuously pushing the boundaries and
thinking beyond conventional design approaches to how we fur-
ther improve. The next step for banknote design is helping optimize
the recycling and sustainability elements. We already measure
and model the impact of our banknotes through production. We
now need to use great design to further minimize that impact.
Can you tell us a little about your design process at De La Rue
and how you have engineered client value into it?
AN: We have an end-to-end design process at De La Rue, where
customers can work with us closely to realize their creative aspi-
rations. Uniquely we can offer a solution for print design, substrate
design (for paper and polymer), as well as security feature inte-
gration of either De La Rue security features or those of 3rd party
suppliers.
We engage with customers to understand their needs in inter-
active workshops, where we take cash cycle data from DLR An-
alytics™ and counterfeit data from our in-house experts, to drive
decisions around requirements and blend these with aesthetics,
to create customer value.
I think that an important element overlooked is the value of the
integrator, where all the complexities of substrate, print and se-
curity features interact. De La Rue designs banknotes and cur-
rency products for manufacture across our sites in Europe, Africa,
and Asia, as well as commercial providers. Our experts design be-
spoke banknotes for every type and age of banknote equipment.
Do you consider the work of a designer today to be more about
creating a piece of client-specific art or integrating feature tech-
nologies into a functional landscape?
AN: I think personally that the banknote is a functional document,
and that to me has led the designer of today to have to consider
the manufacturing technologies, the circulation criteria and of
course the artistic impact.
What that means for the designer is a change in their skills, 25
years ago banknote designs were hand painted, then came the
age of computer design, but this is all focused still upon the
graphical elements.

32 ibda INSIGHT 21
 SPOTLIGHT INTERVIEW // ALAN NEWMAN

Today a Banknote designer needs to consider security, aesthetics, We have looked at projects and asked ourselves how we
manufacturing efficiency, environmental impact, counterfeiting could have achieved the creative outcome without all of the de-
and circulation behaviors, and De La Rue have embraced this in sign iterations, and what we have learnt is that by defining the
their Banknote Product Designers. requirements upfront with the client limits the iterations.
Like any journey its best you define where you’re going and how
How would you describe your design team working philosophy? before you set off. We test and learn throughout the process –
AN: Our philosophy is Design is the application of intent: The way exploring concept designs before committing to fully finished
we create products should meet the needs and desires of the banknote designs for instance. Over the years we have optimized
customer and users. We use experience and data to improve the our approach to make it efficient whilst also allowing for the nec-
product lifecycle – a circular design philosophy - where we con- essary creative immersive experiences.
sider the efficiency, the materials, and its circulation environment.
We focus on customer needs, building endearing relationships With many design teams experiencing generational change as
and most importantly trust. We are product architects and it is experienced designers retire, how does De La Rue identify, and
our responsibility to guide customers and stakeholders alike with engage new designers?
decisions from feature selection and placement to user engage- AN: Firstly, we work closely with our Human Resources department,
ment and durability considerations. A DLR designer must have a and carry out annual succession planning meetings. In this way
holistic view on the entire product lifecycle and, as part of our we can forecast our future designer needs. We have an excellent
ethos of continually looking for better must think beyond design. onboarding program for our new designers, and we have affiliations
with some of the UKs best design schools, were we place
Do you believe that design has a role to play in supporting cash students in De La Rue for short periods or visit their exhibitions.
in our emerging multi-payments ecosystem and if so, why?
AN: Absolutely! Cash plans a fundamentally important role in
ensuring we have a sustainable payments landscape in the future.
The benefits of physical cash are well documented – it is physically
there when other infrastructure fails, it is ubiquitous and the only
way to pay for some people. It also has hidden benefits (such as
keeping other payment fees low by being free-to-use-competition).
Other payment methods may be growing in popularity (sometimes
even faster than cash is growing) but banknotes have a major
role to play for a long time. However, the payments landscape is
evolving, and the needs of the Banknote Issuing Authorities are
also evolving, so great design is needed to ensure that banknotes
still function and serve their purpose.
Some of the trends that we see are cash cycles becoming
more automated, recycling becoming more important and bank-
notes generally becoming more secure. As an example, combi-
national threads are now more popular than single technology
threads. Paper banknotes are increasingly adopting two or three
major public recognition features (such as a thread and holographic
patch) when just one was more common ten years ago. Holographic
stripes are increasing in popularity. Also, the transition to polymer
continues, with many central banks now progressing from lower
value banknotes to higher denominations, with associated security
(such as holographic stripes in the windows of the notes).
Banknote design optimizes the more advanced banknotes for
manufacture and function in the cash cycle whilst maximizing
the possibilities of the new technologies.

More work for the same results… this is oen cited as a growing
issue by designers who frequently have to deal with multiple de-
sign iterations in order to secure client approval. How does your
team manage this phenomenon?
AN: Yes of course from a purist lean perspective “Right first Time”,
is the most efficient approach. But design is a creative experience
its immersive and it involves a creative journey with the client.

ibda INSIGHT 21 33
SPOTLIGHT INTERVIEW // ALAN NEWMAN
Do you see a difference between a banknote designer and a secu-
rity feature designer?
AN: I certainly see a difference in the Banknote Industry particu-
larly where third-party security feature designers have limited
understating of banknote design and the interactions that take
place. At De La Rue we have amalgamated the roles which were
previously separate. The catalyst for that has been in polymer
design were the integration of the substrate has led to an even
greater integration between substrate, print and security features
than ever before.
Does De La Rue’s growing involvement in polymeric substrate
technology (and associated features), have an impact on your
design process and if so, how?
AN: With polymer substrate banknotes the design process not
only has to consider the banknote printing process but also the
extra print processes in the polymer opacification, and the inter-
action of these together.
This brings about not only a new approval process for the
polymer substrate layers with the client, but also the behaviors
of inks influenced by the substrate.
Our color management process in design, considers the influ-
ence of substrate on ink color between paper and polymer, and
this is understood during the proofing process.
Many industry observers are highly critical of the current practices
involving offering heavily or even free design services to the client.
Do you see this as being a real danger in terms of preserving
design value and is it an inevitable consequence of current market
conditions?
AN: De La Rue probably has the largest Design team in the com-
mercial industry and about 30% of the worlds designs in circulation
have been designed by the De La Rue team. From a business
perspective that design team comes at a cost and if design is
offered as a free service then of course it erodes the value of
design (and ultimately the quality of banknote design as investment
reduces). What I observe is a shift in the value of the banknote
toward the security features, and away from the printers and inte-
grators. Which is ironic in a way when no single security feature
serves as a sole deterrent to counterfeiting or to public recognition,
and it’s the layered integrated banknote which delivers best.
34
For now, De La Rue holds a huge amount of pride in designing
world leading banknotes and delivering the best to our cus-
tomers. And the benefits were clear when it comes to awards
such as the International Bank Note Societies banknote of the
year, with 5 out of the top 7 notes being designed by De La Rue.
In the future, do you see any value remaining in design or will it
become a commodity, offered at zero cost to clients in order to se-
cure print, substrate or feature business?
AN: For a commercial business, services offered a zero cost typ-
ically don’t make economic sense and therefore must provide
other tangible benefits or leverage to create value. Design no
longer secures print business in a tender driven market, where
cost inevitably wins. Perhaps a more radical approach to design
needs to be considered where security feature suppliers buy ‘real
estate’ on a banknote like advertisement space which contributes
towards the overall design integration.
If you could send a message to Central Banks on the subject of
discounted design services and related short-term, unsustainable
market practices, what would it be?
AN: Design is the framework which brings together the materials,
the security features and public interaction. Good design helps the
public navigate and immerse in the banknote and supports the
success of both security and the communication of its message.
Without the design, no individual security features are suc-
cessful. Therefore, treat design as your primary security feature,
as its this that forms you first level of defense with the public and
respect that good design adds value.
And finally, what is your vision for the future of design and the
designer’s role in the banknote value chain?
AN: That design is integral in creating the framework of not only
the aesthetics but core on the functionality, the manufacturing
efficiency, meeting its user needs in the cash cycle and its sus-
tainability and environmental impact.
The designer’s role will develop to consider more of the circular
economy of banknotes, and the influence of how design decisions
will impact.
ibda INSIGHT 21
 35.
Substrate —
special section

Contents

New Substrates and Their Impact on Banknote Design 36

Technology Sparks New Banknote Design Possibilities 37

The Impact of Substrate Choice on Banknote Design 39

Polymer and Intaglio: Our approach 41

Substrate as a part of Banknote Design 46

The Substrate of Utopia 49

Reversing Plato’s Cave (Part 1) 51

SAFEGUARD® Beyond clean, green, durable and secure. 53

The Environmental Cost of Spending Paper vs. Polymer Banknotes 58

Pushing the Boundaries: Evolution of Security Features on

GUARDIAN Substrate 63

vibda INSIGHT 21 35
Substrate — Special Section
New Substrates and Their
Impact on Banknote Design
Article by Mark Stevenson, IBDA
F
rom the 1950’2-80’s banknote designs were mainly artistic
compositions that would be banknotised or filtered to make
them manufacturable under the constraints of the 3 printing
processes used at that time; offset, intaglio and typography. Most
banknote printers, commercial and state-owned, organised their
workflows accordingly and design was considered a function of
the manufacturing process.
In the 1990’s a plethora of new Level 1 features were born and
we started talking about design integration and how to best ac-
commodate these features in what was previously an offset and
intaglio dominated landscape. New features required new
processes and the standard banknote production process dou-
bled in size from 3 simple steps to 6 or more with the addition of
screen, foil application, flexographic varnishing and of course
automated sheet or single note inspection.
Then, new substrates and embedded features took center stage.
While these new substrates were primarily developed to address
the issue of soling and durability, developers realised their true
potential by engineering these substrates as carriers of a whole
new family of Level 1 security features.
36
Today, new substrates engineered upon both cotton and polymeric
surfaces or sandwich technology offer a whole new dimension
to banknote designers in terms of design innovation and user at-
tention capture. Substrate innovation can facilitate a true evolution
and revolution in terms of what banknotes look like and how
they engage users to create trust, confidence and certainty.
This edition of IBDA Insight focuses on one of the above core sub-
ject; ‘Substrate Evolution & Banknote Design’. This subject will be
addressed from a wide range of perspectives and it is important
to view this subject in a holistic manner as substrate choice, with
its inherent characteristics’ will have an impact on every single
actor in the banknote design, production, issue, distribution and
user chain.
We hope you find this special section interesting and informative
and as always, we welcome your input and feedback on this fas-
cinating subject.
Happy Reading….
ibda INSIGHT 21
 Substrate — Special Section

Technology Sparks New Banknote

Design possibilities
Article by SICPA

PARK Flow ® was born in 2020, a surprising year of swift,

S
disruptive change across the world. Contrary to change
that leaves people feeling powerless and with few or no
choices, the creative energy of SPARK Flow ® brings exciting new
possibilities to empower banknote issuing authorities and the se-
curity printing industry.
This evolving technology invites designers to explore and master
the new dynamics with curiosity and ingenuity. It also inspires the
security printing industry to tap deeper into the rich potential of the
technology, turning it into industrial reality and printing mastery.
As SPARK® technology continues to progress and shine, it opens
up a universe of possibility for everyone. Counterfeit resilience,
intuitive detection, versatility, durability, printing excellence and
design sophistication become a uniting force as expressed
through the SPARK® feature.
Successive waves of technological breakthrough
Since its initial launch, SPARK® has experienced continuous
growth and expansion, becoming a trendsetter for optical security
features. Its evolution covers a wide range of domains: pigments,
ink formulation, design integration, substrate versatility, magnetic
assemblies, and printing equipment.
The printing modules were co-developed by SICPA and Koenig
& Bauer Banknote Solutions and are industrialised by the latter.
They are designed to allow a quick and easy upgrade for any
SPARK ® module already installed on a NotaScreen II.
The versatility of printing on various of substrates has also
increased with evolving UV-LED formulations developed for
instant curing. SPARK Flow ® can be printed and integrated on
standard substrates such as paper and polymer as well as inno-
vative substrates, including banknote windows. Technical support
is provided for pre-industrial tests to ensure high-quality
production and compatibility with other banknote elements and
alternative substrates.
The three technological innovations of SPARK Flow ® : PRIME,
DIMENSION and CONFLUENCE unite to form a stream of creative
possibilities offering unprecedented visibility, design excellence
and cutting-edge security.
1. SPARK Flow ® PRIME

SPARK Origin®, the first generation of the optical technology, was

launched in 2006, offering a combination of dynamic effects and
striking colour-shifts, reinforcing the protection of banknotes
against counterfeiting threats.

SPARK Live ®, a technology upgrade in 2014, aimed for a higher

resolution, an extended range of effects and optimised magneti-
sation process, taking the printed feature to a new stage of opti-
cal excellence.

With the ongoing launch of SPARK Flow ®, banknote industry

stakeholders are witnessing a clear step forward for the dynamic
SPARK® feature. Technological breakthroughs have enabled the
creation of beautiful, eye-catching and thematic features, with
impressive effects that engage and intrigue the user.
The multitude of innovations behind SPARK Flow®
SPARK Flow ® is powered by several innovations that achieve
brilliance, 3D visual impact and combined effects, stemming from
technological breakthroughs in the domains of ink formulation,
printing modules, curing chemistry and design knowhow.
This is the core innovation of SPARK Flow ®, producing heightened
brilliance, colour saturation, contrast and sharpness. The prime
attribute is unparalleled visibility obtained through an innovative
pigment-orientation process, namely the biaxial pre-alignment
magnetic module. The result is an eye-catching, dynamic optical
feature with a sharper glow and more vibrant colours, applicable
to all families of SPARK Flow ® effects.

ibda INSIGHT 21 37
Substrate — Special Section
2. SPARK Flow ® DIMENSION
®
The second innovation of SPARK Flow creates dynamic optical
features with augmented 3D visual impact. It adds the dimension
of volume to a broad variety of shapes, forms and patterns,
paving the way for a new family of stunning effects.
This powerful visual experience is achieved by combining a new
biaxial simultaneous-alignment magnetic module together with
the latest customisable magnetic assemblies. The new family of
effects creates an intriguing perception of relief and depth on a
flat surface, tempting the user to touch and verify.
With the use of biaxial magnetic module DIMENSION Flow ® in ad-
dition to PRIME Flow ® configuration, the resulting SPARK ® feature
achieves unprecedented brightness and the 3D visual effects.
3. SPARK Flow ® CONFLUENCE
The CONFLUENCE Flow® process generates dynamic optical features
with combined effects in contrast, fusion or sequence. This third inno-
vation creates optical features which are created in one single pass
through two magnetisation modules and selective, sequential curing.
38
(Note: CONFLUENCE Flow® modules by Koenig & Bauer Banknote
Solutions will be commercially available from 2022 onwards after final
industrial testing.)
SPARK® above and beyond the summit
“Why do you want to climb that mountain?” This question was
addressed to free solo climber Alexander Honnold. “Because it’s
there,” was the passionate climber’s spontaneous and straight-
forward answer.
And it is this same rationale that lies behind SICPA’s continuous
efforts in taking SPARK® to new heights. Its rich potential is there
for the taking and the technology will reach its maximal potential
only when designers and security printers bring its creative com-
plexity into reality.
The SICPA team takes great pride in growing SPARK® as one of
the most elegant, intuitive and customisable optical solutions for
central banks, security printers, designers and users.
While SPARK® experts are enthusiastically reaching out for the
next wave of SPARK® creativity, it is important that each banknote
project moves along at its own pace to allow the integration of
these innovations. The technologies of SPARK Live ® and SPARK
Flow ® will coexist to enable security printing partners to keep
their options open.
By continuously exploring the uncharted territory of this dynamic
optical technology, SICPA demonstrates its commitment to se-
curity printing excellence through cutting-edge material-based
technologies and features.
To get a glimpse of the vision behind
SPARK Flow ®, view the official trailer
by scanning the QR code.
» https://vimeo.com/468965260
SPARK Flow ® specimen cards showing some of the creative possibilities for
design and integration offered by SICPA’s latest optical technology (created in
collaboration with Geneva-based design studio RETINAA).
SPARK Flow ® SPARK Live ®, SPARK Origin ®, PRIME Flow ® , DIMENSION Flow ®,
CONFLUENCE Flow ® are trademarks of SICPA HOLDING SA, registered in
Switzerland and registered or pending registration in other countries or otherwise
protected by law.
ibda INSIGHT 21

The Impact of Substrate Choice on
Banknote Design
Karin Mörck-Hamilton
Crane Currency
How would you describe your
role in the banknote design
process?
KMH: The Banknote Designer’s
responsibility is to make sure
that end product, the banknote,
meets all different requirements
regarding security, ease of pub-
lic use, is ‘seen’ by sensors, and is producible, cost effective,
durable and, yes, attractive. My role is to map out all these re-
quirements, many times based on a given specification, and to
integrate them into a banknote structure/architecture and ensure
the end product meets all expectations.
I have said it before: A Banknote is a product and product design
is a process to develop solutions in a manner where both func-
tional and aesthetic demands are included.
For this you need to work with a team of different skills and com-
petences. But as the Banknote Designer, you have to take the
lead.
How do you evaluate different substrate types for a new series of
banknotes?
KMH: In most cases the Central Bank has already specified sub-
strate(s) before the design work starts.
In some cases I have been part of pre-decision phase as a con-
sultant like for the new Swedish and Norwegian series. In the
Swedish project different substrates were evaluated from different
perspectives such as the variety and integration of preferred
security features, cost, tradition/recognition by the public, ink
staining etc. Ultimately, in the case of the Riksbank the customer
made the decision to use a durable paper substrate.
Central Banks such as Reserve Bank of Australia and also Reserve
Bank of New Zealand have a long tradition of polymer substrate
as the supplier originated in Australia.
Other Central Banks take a new step and decide to go for a com-
pletely new substrate or sometimes mix different substrates in a
banknote series. Decision to mix substrates is in most cases
based on durabilityv/longevity concerns rather than security.
ibda INSIGHT 21
Substrate — Special Section
Depending on the country and environment the decision is very
individual. Paper and polymer substrates wear differently and also
substrate is the carrier of security features which have to be as
durable as the substrate to make sense.
When mixing substrates in a series, it is of course challenging
from the designer’s point of view. You want to create a banknote
series that speaks the same language despite the difference in
substrates.
In your opinion, how does substrate choice have an impact on
banknote design?
KMH: Substrate choice has of course an impact on the design
as banknote design is about integration of security features into
the substrate or applied on the substrate.
Substrates such as polymer or sandwich/layered substrates will
have an impact on security feature choice. Even choice of a cer-
tain paper substrate might have an impact on the design such as
intaglio depth.
So substrate is important part of the banknote and therefore the
designer will always take this into account when creating the
banknote structure/design.
How did substrate choice have an impact on your own design
process?
KMH: Substrate choice does not really change the basic design
process. We follow a standard process which allows us to work
with different designs/structures. This basic design process helps
when substrates, features and requirements are slightly different
between projects. Design itself will be different depending on
substrate but having one basic process helps when you have to
do research about new features and work with new suppliers/stake-
holders. In the end, the architecture is similar for all banknotes, it
is just the materials and its adaption that is different.
How did substrate choice enhance your final banknote designs?
KMH: The choice of substrate itself does not enhance the bank-
note design – a skilled banknote designer enhances the final
design by adapting to the characteristics of the substrate and
making it an integrated part of the banknote.
39
Substrate — Special Section

Did substrate choice have any adverse impacts on your final de-
sign and if so, how?
KMH: I would not say negative impact, but when working as a
designer, with a completely new substrate, there might of course
occur “surprises”. For example, when working with polymer the
first time, I did not know that this substrate is very transparent in
the areas where it is expected to be opaque. So a motif printed in
a dark colour on reverse would be visible on the front. Being a
banknote designer you are already very much aware of the im-
portance of different feature positions in relation to each other,
front and back. For printing and also machine readability purposes.
If not being aware of the polymer substrate transparency, you
might end up in a situation where a strange dark shape from
reverse is visible on the front portrait. This is why proofing on the
actual specified substrate is so important. You learn by trial and
error, but the errors should happen in proofing, not in production.
Would you say that the choice of substrate opened a significant
amount of new design possibilities for your series of banknotes?
Can you give some clear examples?
KMH: Well, we are today engaged in some interesting combina-
tions that are too soon to talk about, but I won’t rule out another
interview some months down the road.
but to make sure that machine readable features are positioned
and designed correct front and back in the overall banknote
design. Important to have these discussions early in design
process and also to check test/measure samples and proofs in
different MR equipment. It is an important part in the Banknote
Design process – not only to make sure the design can be read
easily by sensors but also to make sure the BEM’s get the
needed information to be able to program the equipment so that
it can identify the banknotes.
How do you see banknote substrates evolving in the future?
KMH: Well, substrate will not be less complicated that’s for sure.
More features will be part of the substrate already before printing
has started to add on more features.
This may cause initial challenges in production. But substrate is
an important part of the final banknote product and when de-
signed well, everybody in the production chain should be aware
of the quality demands and why every step in the production
process is important.
Everyone must know the end product and how it will be used.

What was the most interesting thing for you about working with
a new/different substrate?
KMH: The most interesting thing is that you learn something new.
This applies on everything new such as new security features.
You have to take your time and try to understand as much as pos-
sible about this new material/product. Understand how this can
be integrated into the overall banknote design. And also figure
out how a counterfeiter should attack it as a stand-alone material.
How can I make it secure by design?

How did you validate the impact that a new substrate would have
on human banknote users once issued?
KMH: A completely new substrate such as switching to polymer
from paper substrate might be a challenge. The public is used to a
certain feeling when touching and handling paper banknotes and
with a completely new substrate, the public must be trained and it
will take a while to get used to it. With a new substrate comes new
security features and these have also to be informed about.

Most efficient is to introduce features that are bold and obvious.

These the public will notice and learn, and hopefully not look at
to the exclusion of all other features – it’s a balance. So substrate
is the carrier of features and when integrated well into substrate,
these are what the public will remember, not the substrate itself.

How did you validate the impact that a new substrate would have
on automated devices in your cash cycle?
KMH: Introducing a New Banknotes Series always requires com-
munication/team work with the BEM’s (Banknote Equipment
Manufacturers), not only because of an eventual new substrate,

40 ibda INSIGHT 21

Polymer and Intaglio: Our approach
Article by Lachlan McDonald Technical Services Manager, CCL Secure
S
ince their inception in the
1980s, polymer banknotes
have featured either two-
sided intaglio (seen in Australia
and New Zealand) or a mix of
two-sided intaglio on higher de-
nominations and single-sided on
low denominations (as used in
Vietnam and Romania).
From the earliest days, it was
clear that polymer is a different substrate to paper, so the use of
intaglio also needs to be different. In this article, I outline CCL
Secure’s approach to the use of Intaglio and why we feel it’s
both effective and important on polymer banknotes, but also
why we feel that intaglio needs to evolve.
First, let’s explore the relationship between intaglio and polymer.
There are three areas to focus on: the use of intaglio on
GUARDIAN TM polymer substrate, the application of intaglio, and
the future of intaglio on polymer.
Polymer has always been what – these days – would be called a
disruptive technology in the banknote industry. As with any dis-
ruptive technology, it can create a certain level of unease about
exactly how the technology interacts with more established
technologies. So, it’s hardly surprising that the role of intaglio on
polymer has always been an area of concern for some people. It
should also be remembered, however, that the developing tech-
nology of polymer substrates also provides an opportunity to
develop intaglio further too.
If we cast an eye back over the last 100 years, although Intaglio
was in the past used for printing many different products, it was
really only in the 1940s and 1950s that Giori developed intaglio
printing as a high-end technology for banknotes, developing a
six-colour intaglio printing press in the process. Now, with polymer
banknotes over 30 years old, it seems a good time to take stock
of how we have used Intaglio with polymer and how its method
of application has evolved during that period.
ibda INSIGHT 21
Substrate — Special Section
The many different ways intaglio is used on polymer banknotes
can be grouped into a few broad categories.
The first category is two-sided intaglio. As a broad rule of thumb,
CCL Secure actively encourages two-sided intaglio on GUARDIAN
banknotes. All the early polymer banknotes used it, and it still
features in a lot of designs today. Central banks such as the
Reserve Bank of Australia and Reserve Bank of New Zealand
have each issued two series on GUARDIAN that used two-sided
Intaglio on all the notes in the series.
There are many benefits for the proven polymer-Intaglio combi-
nation, such as:
» Security. The security that comes from a smooth substrate
with raised tactile print is enhanced by the better print
quality for micro text and fine line work that the smooth sub-
strate enables.
Guardian Paper
» Feel and slip characteristics of the note. In bundles of
notes, two-sided intaglio can be more stable, easier to count,
and also feel less slippery. This is an important characteristic
that helps to avoid the stapling of notes.
» Consistent intaglio height. With paper, there is a small loss
of Intaglio height from the first to the second pass through
the Intaglio printing process. This means that some tactility
is lost going from a first to second pass. This is not the case
for polymer banknotes.
However, although there are many benefits of two-sided intaglio,
Reverse side Intaglio 1st Pass Reverse side Intaglio 2nd Pass
41
Substrate — Special Section
we also see some disadvantages. The first is production efficiency
and spoil rates, particulary for small jobs and new printers. This
is really due to intaglio setoff and is common to both paper and
polymer. So, when banks are looking at the cost of production, a
decision needs to be made: does a process which can add 2%
spoilage justify the extra security that it delivers? Intaglio also
has a lot of inherent costs such as the machinery, inks, effulent,
and plate manufacture. What we do know, however, is good
Intaglio print is achievable on GUARDIAN at low spoil rates, but
as an industry we need to simplify the system so this is more
eaily achievable for new jobs.
A second potential downside to intaglio is that the rate of Intaglio
ink wear is greater than for offset print. When circulation data
shows that we get 3-5 times longer note life from GUARDIAN
over paper, including over-varnished paper notes, does intaglio
risk making some notes look worn out at the lower end of this in-
creaced life time range? This can be true in countries where
banknotes are folded in front first, so that the back of the note is
more exposed to wear.
As long as the central bank has good control of note quality
standards, ink wear is not be an issue. But, if the cash cycle re-
sults in notes staying in circulation well beyond their useful life,
for example 7+ times longer than the paper note, these zombie
notes can become an issue in terms of the public’s perception
that notes are wearing out. This risk has nothing to do with hot
or cold, or humid or dry climates, but everything to do with cash
volume per capita, use in circulation, and cash supply — all of
which impact a central bank’s ability to maintain note quality
standards. Naturally, this drives both CCL Secure and central
banks to look at alternative intaglio strategies. The first of these
is, of course, single-sided intaglio.
The use of single-sided Intaglio is often driven by a Bank’s own
cost/benefit analysis of intaglio and is – as it should be – com-
pletely independent of the choice of substrate. For example, both
the Bank of Canada and Bank of England had a single-sided
paper banknote series before moving to a single-sided polymer
42
series. When, ultimately, the ECB switches the Euro to polymer,
it wouldn’t be surprising if they followed the same route!
From a CCL Secure perspective, as the world’s most experienced
specialists in polymer banknotes, our focus is on intaglio coverage
in order to maintain features such as magnetic intaglio inks and
DR embedding. Our main concern is to balance the competing
real-estate as effectively as possible.
Therefore, while we fully support two-sided intaglio, we also
recognise that front-only intaglio can be more cost effective both
in terms of production and note life for some notes.
The next three categories for the ways in which intaglio is used
with polymer are quite different to paper and have been devel-
oped over the past 30 years largely to maximise the advantages
of polymer.
In Mauritania, we used two-sided intaglio, but through design we
minimised the impact of intaglio wear by incorporating ‘sacrificial’
intaglio. This new concept is a very different design approach.
Essentially, all the main iconic features and text which would tra-
ditionally be printed in intaglio are printed in offset. But, pattern
work around and over these key areas is printed in Intaglio.
As a result, even if the intaglio wears faster than the offset, the note
will still remain fit for longer as the visual impact of Intaglio wear is
minimised. This is particularly relevant for high-wear areas of the
note, such as the fold lines. This is quite easy to design in and
maintains much of the attractive security and tactile characteristics
of intaglio while addressing concerns about Intaglio ink wear.
Another category for the use of intaglio with polymer is the some-
what controversial technique of using clear intaglio. The reason
for using this technique is to increase note life even further than
the 3-5 times that polymer notes achieve compared to paper.
However, the context in which the note is likely to be used is crit-
ical. So far, clear intaglio has been recommend in the following
circumstances:
» The face value of note is under US$1. Typically, this type of
note is used in countries that have no coins in circulation.
» There can be as many as 8 paper denominations, with the
lower ones sometimes below 20 US cents in value.
ibda INSIGHT 21

» Where it is difficult for the Central Bank to control the supply
and withdrawal of these low denomination notes. Often the
availability of certain denominations can be limited and notes
per capita low.
» Complex cash cycle due to geography.
» High wear cash cycle so the Bank is looking for not only the
normal 3-4 times note life from polymer but 4-5 times note life.
Naturally, under these circumstances, the pressure on the bank-
notes is quite considerable. However, clear intaglio is not just
about durability. It can be combined with coloured intaglio and
used as a security feature when, for example, printed over gold
to create a latent image.
This works by applying a metallic gold print to the smooth polymer
surface and then the clear intaglio image above. Viewed from
one angle, only the gold is visible. But, at a side angle, the clear
intaglio image appears.
Another category in which intaglio and polymer combine particularly
effectively is blind embossing in a window. This technique is not
very effective in a white area, but over a smooth glossy transparent
window or a gold print, it’s very effective. This feature, using
deeper engravings, is used on the new Australian, New Zealand,
Canada series, as well as the GBP20.
The sixth category to look at is not actually an intaglio feature but
compliments intaglio as a tactile feature.
ibda INSIGHT 21
Substrate — Special Section
Tactile emboss features were first introduced by Canadian Bank-
note for the Canadian polymer series in 2011. There are different
ways these tactile emboss features can be applied, but none use
intaglio. A popular route is to use the letterpress process with em-
bossing blocks in place of numbering blocks. The key point is
that a permeant deformation of the polymer is possible with
heights of around 150 microns. Applied as clusters of dots, they
assist the public in differentiating between denominations. This
technique is now used on banknotes in Canada, Australia, Eng-
land, Mauritania, Costa Rica, and many other countries.
Other key parameters to consider relate to the actual application
of intaglio onto polymer. In broad terms, these parameters are:
engraving depth, printing pressure, plate temperature, process
sequencing, front and back print sequence, and sheet deformation
and registration.
Traditionally, polymer banknotes have had shallower engravings
than paper - around 40 to 60 microns in depth. Recently, however,
we’ve noticed that existing intaglio plates designed for paper are
working well on polymer. The engraving depths for paper seem
to be shallower than in the past.
We still make changes to the line width, stepping, and ink holders,
as polymer gives a much sharper print than paper and less dis-
tortion. But, these days, the engraving depth tends not to need
much adjustment. Parameters such as ink holders are particularly
useful, as the polymer is not forced into the engravings as much
as would be the case with paper and - with shallower engravings
- we want to avoid ink wiping out of the engravings. Ink holders
also help to control the ink and to achieve more precise printing
with no feathering or ink line gain.
Using polymer, we typically increase the printing pressure to im-
prove the quality of the print. At first, this requirement can be
met with some resistance by printers who are more familiar with
paper. The results, however - improved print quality and tactility
– are very persuasive. The actual level of increase in pressure
depends on the packing, engravings, and design, but as rough
guide, a pressure of 200Nm on paper would be 350Nm using
polymer and a super Intaglio orlof.
43
Substrate — Special Section
At the same time as increasing pressure, further benefits to in-
taglio setoff can be achieved by increasing plate temperature to
nearly 90°C. Typical settings are:
Plate temperature: 84°C – 87°C (Actual plate
temp)
Duct temperature: 22°C to 30°C (18 - 20°C
temperature for OVMI®)
Polychablon cylinder temperature: 25°C
Blanket cylinder temperature: 37°C
Wiping cylinder temperature: 40°C (Cooling water)
Wiping solution temperature: 50°C
Another difference between paper and polymer is the sequencing
used for each process, such as screen printing and foiling. With
the use of screen printing with intaglio on polymer banknotes
growing in popularity, there are – naturally – discussions about
which of the processes should come first in the sequence. In CCL
Secure’s experience, the optimum approach is to print screen and
foil before intaglio. There are a number of good reasons for this:
» The substrate is already smooth, flat and non-permeable
» We are normally registering the screen print or foil to the sub-
strate not the print, so registration is easier before intaglio
» Additional care needs to be taken to avoid spoil at intaglio
because it’s a more value-added product
» The sequencing minimises the risk of intaglio damaging
screens
Another sequencing parameter that is different for polymer is the
choice of first and second pass Intaglio for the front and back of
a note. With two-sided intaglio on paper, the reverse side would
usually be printed before the front side. This is due to the pressure
of intaglio flattening the paper embossing and Intaglio print at
the second pass. With polymer, however, there is little embossing
of the substrate, so we can print the front and back on either the
first or second pass. With polymer, we’re focused in intaglio
spoilage, which means there can be an advantage in printing the
front first, so that any setoff (a normally lower occurrence on the
second pass) is on the reverse side of the note.
Finally, it pays to consider the issue of deformation and registration
with offset. Here, again, there is a distinct difference between
the properties of paper and polymer. GUARDIAN uses a unique
balanced film, which means that its physical properties are the
same in both directions. This is important, as we want to avoid
heat-induced sheet curl and distortion through the application of
heat and pressure to the sheet. A GUARDIAN sheet after intaglio
is still square, but the print can be 0.5mm narrower at the tail
edge. This is simply because the sheet is slightly elastic through
the intaglio press. Any distortion, however, is 4 times less than
that experienced by paper and is only in the print, and has no
44
impact on following processes - including cutting. This comparative
lack of distortion during the intaglio process applies to a balanced
film such as used for GUARDIAN.
The unique, balanced film properties of GUARDIAN enable it to
be foiled at 90°C and 7,000 to 8,000 sheets per hour (sph). This
significantly reduces any tension and heat distortion to the sheet
as well as helping productivity. The critical factor here is dwell
time. If you run at a slower speed but maintain the temperature,
there will inevitably be more dwell time, resulting in more sheet
distortion. At 90°C and 7000 sph there is very little sheet distor-
tion. If the film is thinner than the 75 microns of GUARDIAN
and/or not balanced, foiling conditions will change and so will the
level of sheet distortion.
What about the future? How will intaglio and polymer banknotes
develop over the next few decades, building on the knowledge
and experience that has been gained from the past 30 years?
CCL Secure’s view is that intaglio still has an important role to
play for all banknotes and is worth the continued research invest-
ment into the development of the technique. Many of the chal-
lenges that can be identified are largely driven by cost. So, for
example, there are certain to be discussions based on factors
such as:
» Reducing Intaglio/banknote volumes to drive efficiency
» Competition with other features and associated cost trade offs
» Time, spoil and storage associated with intaglio
» Tactility on polymer
» Ink wear on of Intaglio
» Blocking of intaglio
With these factors in mind, CCL Secure is already working on a
number of areas. Unrivalled experience of polymer banknotes is
being deployed to ensure that the advantages of intaglio continue
to be a viable option for central banks.
The company’s researchers are looking, for instance, at develop-
ing white coatings that help with blocking, ink wear, and setoff.
The unique ‘bubble’ film at the heart of GUARDIAN is also being
developed to help levels of intaglio tactility on polymer.
And UV curing inks are being developed to help Intaglio tactility
and setoff, along with insightful development of other factors
such as Intaglio engravings and press settings.
So, after 30 years of bringing polymer banknotes to the world,
CCL Secure still sees intaglio as part of the total polymer banknote
package. Intaglio is one of the individual elements of polymer
technology — such as windows and smooth surfaces — which
ibda INSIGHT 21
 Substrate — Special Section

together add up to a banknote that — if well designed

and targeted — is more than fit for purpose.

CCL Secure and its designers and partners over the

last 30 years have been developing the use of Intaglio
on polymer, and the team is certainly looking to con-
tinuing the development. One look at the line work
of the intaglio blind embossing in the second window
on the new Australian series of notes provides just
one example of how effective intaglio and enhanced
security can be achieved with minimal spoil and cost.
CCL Secure’s commemorative 30 year note with
Note Printing Australia is further evidence of the vi-
ability of intaglio, containing a two-sided hand made
up of Intaglio within a very large window.

How well does polymer work with intaglio? Based on CCL Secure’s experi-
ence, the evidence is conclusive: they work together extremely well when han-
dled with care, knowledge, and 30 years of insight.

ibda INSIGHT 21 45
Substrate — Special Section

Substrate as a part of
Banknote Design
Article by Gellért Barát, Jura

I
n the case of today’s modern banknotes, the base material
cannot simply be referred to as a paper substrate, as one could
50 years ago. Modern plastic, paper, and hybrid solutions result
in complex substrates and by preserving all the benefits of paper
and taking advantage of the possibilities plastics have to offer,
revolutionarily new materials and structures are made possible.
Therefore, when designing a banknote one has to take account
of these new structures and technological solutions. During the
banknote design process, one cannot simply talk about a ‘white
background’ on the computer monitor unrelated to the design.
Oftentimes the substrate itself carries some type of printed
element, such as a picture, ink, or window, next to the traditional

TEST BANKNOTE,
TEST BANKNOTE,
CONCEPT DESIGN
CONCEPT DESIGN
FRONT
FRONT SIDEWITH
SIDE WITH
SUBSTRATE
SUBSTRATE

BANKNOTE
BANKNOTEFRONT
FRONTSIDE
SIDESUBSTRATE
SUBSTRATE BANKNOTE SUBSTRATE,
BANKNOTE SUBSTRATE,UNDER
UNDERUVUV
LIGHT
LIGHT

BANKNOTE BACK SIDE SUBSTRATE BANKNOTE FRONT SIDE, CONCEPT DESIGN

46 ibda INSIGHT 21
 Substrate — Special Section

BANKNOTE
BANKNOTEFRONT
FRONTSIDE,
SIDE,INTAGLIO DESIGN
INTAGLIO DESIGN BANKNOTE FRONT
BANKNOTE FRONTSIDE,
SIDE,INFRA ACTIVE
INFRA DESIGN
ACTIVE DESIGN

BANKNOTE FRONT
BANKNOTE FRONT SIDE,
SIDE,UV
UVDESIGN
DESIGN BANKNOTE FRONT
BANKNOTE FRONTSIDE,
SIDE,ORLOFF
ORLOFFMASKS
MASKS

BANKNOTE FRONT
BANKNOTE FRONT SIDE,
SIDE,
CONCEPT DESIGN,
CONCEPT DESIGN,
OFFSET
OFFSET

BANKNOTE FRONT
BANKNOTE FRONT SIDE,
SIDE,
COLORIZATION
COLORIZATION

watermark and metallic strip. The tolerances and the limitations of
the production of substrates either severely limit or strengthen the
banknote designers’ possibilities. Overall it may be said that the
substrate design is an integral part of the entire banknote design.
The first step in designing a banknote is the concept design,
 the size, orientation,
where  basic scenery, forms, and colors are
determined. The most important step of all the initial ones is to
clarify the substrate in terms of its nature, possibilities, and limi-
tations. From the designer’s standpoint, it is essential that the
manufacturer provides accurate information and technical pa-
rameters because failure to do so can result in a lot of annoyance,
misunderstanding, and delay.
If the designer is dealing with paper substrate, the watermark, the
metallic strip, and the UV fibers should be taken into account first.

ibda INSIGHT 21 47
Substrate — Special Section
With the polymer substrate, the biggest emphasis is on the
see-through windows, though in addition, other built-in – embossed
– effects, as well as pre-printed designs, can be considered in
the preliminary design process. Moreover, even the whole substrate
can get a multi-layer ink coat, which can be metallic, semi-
translucent, color filter, or optical lens.
During the design process, it is imperative to take account of
the placement, size, and manufacturing tolerance of these bank-
note elements.
From the beginning of the banknote design to the final inspection,
the relationship and coherence of the banknote design, inks,
and the substrate are available, visible, and verifiable in almost
all steps.
It is important to note that the design program should be fast,
flexible, and easy to use when creating a concept design. The
correlation between the front and the back of the banknote and
the movement of the element can be tracked in real time and
simulated graphically as well.
It serves as a helping hand for designers as the deviations,
movements, and parameters of cutting inaccuracies can be cal-
TEST BANKNOTE
BACK SIDE,
CONCEPT DESIGN
ibrated and checked for the specific manufacturing process.
There are other figures, or rather values that need to be men-
tioned and taken into account such as offset, intaglio, silk-screen,
watermark, thread, cutting, serialization, rainbow, and inking tem-
plates, etc.
Once these data are collected, the designer no longer has to
deal with them one by one in the application, because the
software, based on the saved settings, will display the possible
errors and problems. An important part of the program is to
share these displayed differences with colleagues, who are also
participants in that particular project. This can be done in a digital
still image (jpg), 3D rendering, movie (mp4), or just a technical
documentation (doc).
Furthermore, the designer can choose exactly what they
would like to display in the given document, by enlarging the
48
problematic area. The designer can even toy with certain options
by turning elements on and off, recoloring, or adjusting trans-
parency. Most importantly, the presented material should be
clean, transparent, and straightforward.
Of course, the same should apply to the inspection of the ma-
chine read parameters or designs that react to different light
sources (UV, IR).
The ideal condition is if the design workstation computer helps
to solve the arising problems throughout the design process.
For instance, if the positioning of certain elements is not ade-
quate, the program is able to recommend a solution, while paying
attention to minimize the change in the design and avoid gener-
ating any incompatible options to the other effects.
In this accelerated world, it is vital for work phases to line up
and follow each other in order. In this day and age it is expected
that banknotes should be produced from concept to finished
print with consistency and carefulness. For these conditions,
software help – a perfect, flexible, optimized for a specific envi-
ronment – is needed in order to warn the designer of any errors
or conflict of interest in an instant.
In this way the truly complex and uniform banknote - substrate,
design, production, use - can be produced quickly and seamlessly
with team effort. I can only admire the enthusiasm and revolution
that the new substrate technologies and their developers have
created and enabled in recent years. As a banknote designer, I
hope this remains a journey full of excitement and possibilities in
the future.
ibda INSIGHT 21

The Substrate of Utopia
An essay on the future of substrates seen from a designer
and printer’s perspective
Article by Koenig & Bauer Banknote Solutions
What does perfection look like?
Giving banknote designers a truly blank canvas on which to express
their creativity?
Giving the banknote printer a blank canvas on which they can fully
utilise their process and capabilities to produce the best banknote
possible; the most aesthetic, the most secure?
F
or almost seventy years, Koenig & Bauer Banknote Solutions
has been the leader in high security printing with almost
every banknote in the world being produced with at least
one of its machines or systems. We offer solutions in design
(with our ONE Suite Security Software and consultancy services),
pre-press (with our range of CTPs), in printing and quality control
and all of the supporting systems and services required for bank-
note production.
Since the start of its activities in 1952, Koenig & Bauer Banknote
Solutions have supported almost every supplier in the industry,
helping them develop, test and qualify Security Features and con-
sumables, including inks, foils and substrates. Even though
Koenig & Bauer does not sell Security Features, nor produce sub-
strates and other consumables nor print banknotes, our privileged
position allows us to understand the advantages and limitations
of most of those currently available on the market.
Today, three kinds of substrates are competing for the world
market: cotton-based, polymer-based and hybrid (different com-
binations of paper and polymer). All these substrates have their
advantages and disadvantages in terms of design opportunities,
embedded security, production, printability, ecology and durability
in circulation. Cotton based substrates can have integral or em-
bedded features like watermarks and security threads. Windows
and their integration with printed and applied features are creating
a very strong barrier against counterfeiting on polymer substrates.
Lines and patterns printed on the latter are much sharper and
cleaner. On the other hand, tactility, created by the high pressure
of Intaglio during printing, comes to life on cotton-based substrate
a lot more due its embossing capacity. The same goes for dura-
bility and ecology where cotton is, by essence, biodegradable,
whereas polymer can have a second life when recycled. These
comparisons can go on forever.
ibda INSIGHT 21
Substrate — Special Section
Hybrid substrates are said to bring the advantages of both cotton
and polymer substrates together, although some might argue
they also bring all of the disadvantages too.
When designing specimens or house notes, a term often used is
“Bank of Utopia”. What if one would think about a substrate
being ideal from the perspective of the issuing authority, the de-
signer and the printer: the “Substrate of Utopia”.
From the designers’ perspective, the more freedom to design,
the better. More often than not, they need to hold back on their
creativity due to technical constraints. The movement of the se-
curity thread and the watermark during manufacture, the size and
location of windows are examples of these constraints. Of
course, there will always be design guidelines and constraints
given the nature of banknotes and their use.
What if a substrate was free from these technical constraints?
Was a blank canvas on which design and production could
be used to their maximum? Which could bring new possibilities
in terms of Security Feature development, design elements
and design and feature integration?
Increasing productivity while keeping the quality of the print at
the highest level possible is the number one priority of any bank-
note printer. This requires not only the best and latest equipment
and systems, it also requires a substrate that is easy to print,
handle and cut. Also printing and/or applying Security Features
in the printworks, remains the most secure, controlled process
and environment to produce a finished banknote.
What if this blank canvas enabled the printer to produce all
denominations and currencies in his/her portfolio from one
common stock, one blank canvas? The production flexibility
is unparalleled!
49
Substrate — Special Section

Once the “issuing authority layer” is added, the equation becomes

even more complex. An issuing authority wants a banknote that
is economically affordable but, at the same time, durable.
Moreover, today’s concerns about the environment and what a
banknote becomes after circulation are increasingly important.
This means the substrate of the future would ideally be biodegrad-
able or at least fully recyclable.

If the above requirements are taken into account and considered

from design, print and issuing authority perspectives, shouldn’t
this “Substrate of Utopia” be one delivered “empty”, as a blank
canvas? A substrate that would allow designers truly free rein to
maximise the aesthetics, functionality and security of the bank-
note? A substrate that would be receptive to all current print and
application processes and which would permit great tactility and
thus both maintain the well known feeling, albeit subconscious,
given by Intaglio and ease recognition for the blind and visually
impaired community? A substrate where printers can show their
skills and value in the production chain? A unique substrate of
which the same base sheet could be used for each denomination
of the series, thus facilitating stock management and ordering
procedures? A substrate that would be more cost effective than
most of what is available on the market today? A substrate that
would be biodegradable and thus… green?

With such a substrate, printers having the in-house capability of

design and platemaking would have the most secure and flexible
banknote-printing environment ever seen. Indeed the “empty”
substrate would arrive and be managed, from A to Z, in the print-
works; the most secure environment. Overall production costs,
including transport and logistics would come to their lowest pos-
sible levels, while production flexibility and therefore service to
the banknote issuers could be at their highest.

The end result would bring more flexibility and control in the
hands of the issuing authority, more freedom for the designer to
deliver aesthetic, functional and secure designs and a true
platform for the printer to deliver a final product to meet all the
needs of the banknote ecosystem.

Today this is a dream….

Tomorrow, who knows?

50 ibda INSIGHT 21

Reversing Plato’s Cave (Part 1)
Article by Landqart
(The Allegory of the Cave)
Imagine that we have spent our whole lives crouching on the
ground in a dark cave, chained to a brick wall behind us that is
about as high as a standing person. The chains are so tight that
it is impossible to look anywhere other than straight ahead at the
rough wall at the end of the cave in front of us. On this wall, we
see an incessant spectacle of shadows passing by. The shadows
come from objects which are carried by mysterious figures
standing on or behind the brick wall to which we are chained.
Behind these figures is a fire, flickering mysteriously and causing
the carried objects to cast their shadows onto the bare wall in
front of us. However, we see none of them: neither the objects,
nor the mysterious figures, or even the fire itself. We only perceive
the shadows and know no better than to think they are the reality
of things.
(The Scientific and Cultural Scope of this Allegory)
This is the allegory with which Plato describes our knowledge of
the world: We are prisoners in a cave and can only perceive
shadows, never that which causes these shadows. We only see
illusions, not that which creates the illusions. This allegory is one
of the most important landmarks in humankind’s philosophical
search for true knowledge. It lets us anticipate Kant’s distinction
between the appearance of a thing and the thing itself as it is
without its appearance (the famous "thing-in-itself"). It also hints
at the efforts of physics to peek behind the veil of matter and
recognise what we call "matter" as a field of energy (of which the
Higgs-Boson particle was one of the latest discoveries). In view
of this, it is not surprising that the British 20th century philosopher
Alfred North Whitehead, claimed that everything after Plato is
merely a footnote.
ibda INSIGHT 21
Substrate — Special Section
(The Allegory in the Context of Designing a Banknote)
Now imagine a banknote to be that bare wall in the cave. Think
of the design process as just that: taking objects from reality and
projecting their shadows on the banknote. This is what we nor-
mally do when designing a banknote. "Put this portrait on the
banknote." Or "put this animal on it." Or "put that flower on the
reverse side." The design brief is always the same: it takes its
starting point from a thing in reality and advises us, the designers,
to transfer the image of it that we perceive onto the banknote.
And thus, the design process remains the same, too: it begins in
reality and it ends with a shadow on the banknote.
(Reversing the Allegory)
Now let’s try to reverse Plato’s allegory. Let us make the process
start on the banknote and end in reality. What if it is not reality
that is to cast its shadow on the banknote, but the banknote that
is to project its images into reality? Is it possible to achieve the
seemingly impossible and reverse Plato’s Cave?
(The Window as the Key to Inverting the Allegory)
What are the design tools at our disposal to reverse Plato’s
Cave? Windows: when you hold the banknote against the light,
that light passes through the window and is projected into reality.
Where there is light there is also shadow, so in passing through
the banknote’s window, a shadow also enters reality: the shadow
of everything that is not this window. In this way, the banknote
becomes some sort of lamp or, more precisely, a lamp and
lampshade, shaping the passing light and making it into reality.
And thus, the design process is reversed: The process takes its
starting point from the shape of the window on the banknote
and ends on the projection surface as reality.
51
Substrate — Special Section
(Windows on Durasafe Banknotes)
What are the design possibilities for creating a window? So far,
there have not been so many options for the banknote design
community. But that changes with Durasafe, which ushers in an
entirely new spectrum of possibilities. You can introduce multiple
windows, give each of them their own detailed shapes, and make
them work in perfect harmony with other creative tools (for ex-
ample print, embossing), and become an integral part of the
overall design. With this innovation, and a desire to break away
from the norm, the banknote can be transformed into a beautiful
and complex lamp.
(But Does This Really Reverse Plato’s Cave?)
The crucial question remains: by converting the banknote to a lamp
and lampshade have we really managed to reverse Plato’s cave?
Consider this: whatever the banknote projects into reality, does it
not need someone to have put that on the banknote beforehand?
There is a logical necessity that if a banknote is to cast an image
into reality, the image must be cast on the banknote first. In short:
the banknote can only project into reality what has already been
transferred on it. Plato’s Cave has already struck; it precedes any of
our attempts to reverse it. The condition for inverting it is that it
must already be established. Like being caught in a hall of eternally
reflecting mirrors, we cannot escape Plato’s Cave.
As Plato would have it, what we call reality, in our example, is not
the same as reality in Plato's sense. He would argue that our re-
ality is anything but reality: it is still a world composed of shadows
and appearances that conceal the true nature of things. He would
claim that all we did was cast a shadow upon another shadow.
52
(All is not lost)
However, maybe we were successful in a different way? Instead
of reversing Plato’s Cave, of peeking behind the world of shadows,
perhaps we achieve something else by using windows on a bank-
note: we turn the banknote into what is depicted on it. We make
congruent what are normally two separate worlds: the image and
the canvas. Normally the canvas is simply the canvas. And the
image? It represents anything we need it to, except the canvas.
How would you paint a canvas if you wanted your painting to
represent the canvas? Most likely, you would not paint anything,
because whatever you paint conceals the canvas. However, when
working with windows on a banknote, we try to make this possible
by taking the opposite approach. We make the canvas (the ban-
knote) become what is depicted on it, we make it a lamp and
lampshade, a bringer of light and shadow. We may not have suc-
ceeded in reversing Plato’s Cave, and we may not have managed
to glimpse behind the veil of shadows, but we managed something
else. We turned the wall of our cave into what the shadows project
on it, and that is a huge step forward.
To be continued…
ibda INSIGHT 21
 Substrate — Special Section

SAFEGUARD® Beyond clean, green,

durable and secure
Author: Nikki Strickland, De La Rue

ibda INSIGHT 21 53
Substrate — Special Section

54 ibda INSIGHT 21
 Substrate — Special Section

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Substrate — Special Section

56 ibda INSIGHT 21
 Substrate — Special Section

ibda INSIGHT 21 57
Substrate — Special Section

The Environmental Cost of Spending

Paper vs. Polymer Banknotes
The Bank of England introduced polymer banknotes to replace
existing paper currency back in 2016, citing polymer’s durability,
recyclability and increased security as primary reasons for the
switch. The following infographics may help give you some insight
and fresh perspectives on the lifecycle of paper vs. polymer bank-
notes and their respective sustainability scoring, based on the
Bank of England’s experience.

58 ibda INSIGHT 21
 Substrate — Special Section

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Substrate — Special Section

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Substrate — Special Section

62 ibda INSIGHT 21
 Substrate — Special Section

Pushing the Boundaries:

Evolution of Security Features on
GUARDIAN Substrate
Article by Holger Krumm, Technical Services Manager, CCL Secure

A
blank white piece of
paper can be intimidat-
ing at times. It is full of
ideas, full of possibilities. So
where to start?
The faint-hearted might sit and
despair, but a banknote designer
takes on the challenge, develops
imagery around watermark areas,
places security threads and
screen-printed patches, and cre-
ates something beautiful!
Security Threads – Updating an old Favourite
The origin of windowed threads
Threads were originally developed as a feature fully embedded
into banknote security paper. From the late 1980s, with the ad-
vent of windowed security threads parts of the threads became
visible on the surface and provided the possibility to include
metallic effects into banknotes. A metallic silver thread would turn
into dark grey or black when being photocopied. This was a mile-
stone in banknote security.

This is how it has worked for a

long time and still does in many
cases. However, new technologies have entered the market, are
breaking with traditions and pushing boundaries.

Polymer substrate is one of these new technologies. For designers,

polymer substrate means a new challenge as the blank white
piece of paper is replaced by something even less tangible but
offering even more potential – a clear film.
An early example of a windowed security thread on the GBP 20 issued in 1984

So many new challenges, so many new possibilities, and no

boundaries for ideas! Let’s explore a few of these possibilities
and how they have been used on GUARDIAN banknotes.
First, we look at a link between the old and the new, between
paper and polymer.
The public typically appreciates a certain level of familiarity and
continuity when going through a change. To satisfy this demand
for familiarity, thread-like designs and features that are easily
recognised by a public accustomed to paper banknotes can be
included into GUARDIAN substrate.
Later in the article, we will look at what is arguably the most
iconic polymer security feature, the clear window. The clear win-
dow has gone through a remarkable journey, and has developed
from a relatively simple feature to the platform for some of the
most advanced security technology in the market, taking polymer
banknote security to the next level.
From these early versions, windowed security threads for paper
banknotes have grown in width and window size, and new visual
effects – such as colour-shifts - have been introduced. Techno-
logically, security threads are built of multiple layers applied onto
a polymer base, with the layers used varying depending on visual
and optical effects desired.
Until today windowed security threads are one of the most com-
mon paper banknote security features and an important way to
integrate effect inks into paper banknotes.
Effect inks on polymer banknotes
Thanks to the smooth surface of polymer banknotes, metallic
and colour shifting inks can be applied directly onto the substrate
with stunning visual results. In many ways - and considering the
technological similarities - the polymer substrate itself therefore
becomes the thread. It creates a vehicle for carrying a wide range
of novel optical effects and features with virtually no limitations
to size, position or design.

ibda INSIGHT 21 63
Substrate — Special Section

A beautiful example how colour-shifting ink features can take on

organic and natural forms complementing the aesthetic of a note
once they are freed from the limitations of the straight thread for-
mat, is the Hong Kong 10 Dollars note.

N
A purple to pink GSwitch ribbon hugs the window, circles around
IME
an Intaglio emboss, overlaps with a stylised image of a bauhinia
EC
flower and becomes solid pink print where it bleeds under the SP
white opacification layers.

A colour shifting ribbon integrates the window into the banknote on the HKD 10

On the Canadian 150th anniversary commemorative banknote, shape of maple leaves, numbers and lines, complemented by a
three different metallic effect inks are used to from a complex purple spot colour, and silver maple leaves applied with the foil. On
frame around the window. On the front, Metalix Purple takes the the back, Metalix Green and Copper undulate around the window.

MEN MEN
I I
EC EC
SP SP

Metalix Purple framing the window of the CAD 10 on the front, and Green and Copper on the back

Effects inks developing into structural design elements

The role a security thread on paper can play in creating a design

is very much limited by shape, size and positioning. Contrarily,
effect inks on GUARDIAN can be developed into major structural MEN
design elements covering significant parts of the note. E CI
SP
On the Vanuatu banknote series, colour-shifting GSwitch inks
stretch over about 40% of the width of the note. They comple-
ment the shape of the windows as well as the offset print and Purple to green and pink to yellow colour- shifting inks forming
thereby create the impression of frameless windows. Patterns in the backbone of the VUV 5,000

the colour-shifting inks are repeated as vignettes using the white

opacification layers. The result is that the effect inks become a
backbone of the design rather than being perceived as individual
features.

Similarly, on the Brunei 50 Ringgit note, Metalix Gold covers

MEN
I
about 25% of the width of the note along the left and right note
PEC
edges. The effect ink includes reversed out numerals and a star S
overprinted with the AMBD coat of arms. The red coat of arms
and the golden star form together the ICE feature, an intaglio
colour-change effect. Again, the gold can no longer be considered
as an individual feature but rather the frame for the whole design. Metalix Gold framing the BND 50

64 ibda INSIGHT 21
 Substrate — Special Section

The circle is closing - providing familiarity on polymer

Simulations of fully embedded threads, particularly as functional
elements such as magnetic threads, have been used on GUARDIAN
banknotes for a long time. A solid magnetic thread was issued in
2001 by Banco de Mexico, and a dashed thread with reversed
text in 2003 by the State Bank of Vietnam.
So far, there has been little impetus for effect inks to be designed
in the traditional linear format of a windowed security thread on
polymer. Designers have used effect inks as free-form stand-
alone features, window frames or structuring design elements.
However, this is now changing as more central banks that are
looking to transition to polymer request thread like effect-ink
features. Given the design freedom and scope to maximise the
feature effects, the question is why this is the case?"

MEN As we know, banknotes rely on familiar and well-understood se-

I
EC curity elements that can be identified by the public within
SP fractions of a second. Security threads are one of those features
and in many countries, the public intuitively look for the thin strip
of material woven into the note and exposed at intervals. For
Embedded solid thread on the MXN 20
countries that introduce their first polymer banknote and where
polymer notes co-circulate with paper notes, it can therefore be
helpful for public recognition if a common security feature
template is used for all denominations. The thread’s appearance
can provide continuity between the old and the new, acting as a
N
ME
point of reference for the public as the transition happens.
I
EC
SP

Embedded dashed thread with reversed out text on the VND 50,000

Saudi Arabia has now issued the first circulating GUARDIAN
banknote with a windowed metallic effect security thread. The
design is a polymerisation of the preceding paper note. The inte-
gration of a Metalix Silver windowed security thread into the
polymer design will help with quick and easy recognition of the
new notes by the public as the family-feel of the paper series is
extended to the polymer denomination.
The introduction of a silver-metallic thread into polymer is clearly
only where the design journey starts for windowed security
threads on polymer and not where it ends. The layered structure
of polymer substrate enables the development of amazingly com-
plex threads, e.g. threads with windows on the front as well as
on the back or even full see-through windows, combination of
colour-shifting with metallic effect inks.

N
IME
EC
SP

N
I ME
EC
SP
Common design template: the polymerised version (lower left) of the paper SAR
5 (upper left) includes a Metalix Silver windowed security thread (right)

ibda INSIGHT 21 65
Substrate — Special Section

GUARDIAN Windows – The future of an Icon

The origin of clear windows
Right from the start, the signature and most important feature of
polymer banknotes has been the clear window. A well-designed
clear window on polymer is not simply a round or square hole in
a banknote, but a complex shape well integrated into the rest of
the banknote and carrying other security features.
Over the years, theses complex windows on GUARDIAN ban-
knotes have gone through a remarkable journey. It all started with
solid white vignettes and bold intaglio embosses. Very quickly,
tonal print, metallic and colour-shifting inks, spot colours and
Cameo portraits were added. Next, holographic features and
SPARK conquered polymer windows and today the portfolio of
window features is growing faster than ever!

N N
I ME I ME
PEC PEC
S S

Evolution of the clear window: First and second generation of Australian banknotes with one and three windows respectively

Windows go Level 2

With this vast amount of sophisticated features at hand, at first
sight it might be surprising that white gravure printed window fea-
tures still play a major role on polymer banknotes. But not once
you take a closer look at the options and development potential
that a supposedly simple white gravure printed feature offers.
In 2019, CCL Secure launched the Vivid range of printing inks on
the 30 Years of GUARDIAN house note, a design study jointly de-
veloped with the polymer banknote founding printer Note Printing
Australia. This note blurs the boundary between banknote and
window, as the window vignette - the hand - is critical to the de-
sign and the design gives meaning to the window.
Such a window shouts for level 2 security and cannot be left un-
protected against machine-counterfeiting.
Vivid gravure printing inks can be equipped with level 2 security,
i.e. IR absorption and/or UV fluorescence. Vivid is directly incor-
porated into the substrate during the production process as indi-
vidual design layers. On the 30 Years house note, Vivid ink has
been used to create fine veins visible under daylight illumination
and an invisible 30 Years timeline. The timeline shines bright white
under UV light, the veins, mimicking your own veins and printed
at extremely high resolution, are IR absorbing and UV fluorescing.

Daylight illumination UV light illumination (two different versions of the house note with blue and yellow florescence) IR absorption
Vivid White (30 years timeline, invisible print) and Vivid IR (green veins) on the 30 years house note

66 ibda INSIGHT 21
 Substrate — Special Section

But Vivid inks can not only be applied as visible or invisible print
onto vignettes and opacified areas, Vivid can also become a
white tonal image in its own right.

This feature is called Vivid Colour and was launched on the

Lebanon 100,000 Livres commemorative note printed by PWPW.
Under daylight illumination, Vivid Colour is a white tonal image
providing the overt security of popular features like Cameo por-
traits. Under UV illumination, Vivid Colour becomes a striking full
colour image that will inevitably draw the attention of every person
inspecting the note.

Vivid Colour: The Lebanese cedar tree becomes full-colour under

UV illumination on the LBP 100,000 ›

Design integration of clear windows has always been crucial to Print and substrate design will complement each other, as shown
enhancing polymer banknote security and Vivid Colour extends by the Offset UV firework exploding next to the substrate cedar
this concept into the level 2 realm. tree on the Lebanese commemorative note.

MEN
ECI
S P

Visual and UV image of the LBP 100,000

Windows go 3D

Holographic foils are arguably the current pinnacle when it
comes to overt banknote security. They are the eye-catching
centrepiece of some of the world’s most secure and advanced
banknote series, including the Australian, Canadian, New Zealand
and UK polymer series. GUARDIAN provides an ideal platform
for this technology, as the smooth surface of polymer means the
diffractive effects on foils are particularly bright and vibrant.
Moreover, a foil applied into a window is visible from both sides
of the note, doubling its value.

MEN MEN
E CI ECI
SP SP

Foil in a GUARDIAN window visible form the front and the back on the NZD 5

ibda INSIGHT 21 67
Substrate — Special Section
However, clear windows also offer a perfect platform for other
optical effects and so it is no surprise that lens-based security
technology is finding its way onto polymer banknotes, challeng-
ing the dominance of foils as the main eye-catcher.
Lens-based technology as a banknote security feature was first
made popular as the Motion security thread, which was famously
chosen to protect the US 100 Dollars note.
Cinema in the shape of a camera lens aperture on the Chaplin house note
Cinema technology allows for a vast variety of different 3D effects.
On the Lebanon 100,000 Livres commemorative note launched
in 2020, Cinema technology has been used to create depth and
N
IME
C
S PE
Cinema in the shape of an arch on the LBP 100,000
For the reverse side of the note, there are multiple ways of inte-
grating Cinema by using different offset designs.
Some examples have been demonstrated as different versions
of the Chaplin house note, e.g. a contrast-rich icon that adds an
additional effect to the feature when viewed in transmission or
light offset print that does not interact with the feature at all.
Contrast-rich icon on the back of Cinema Anti-copy
68
With the transition to polymer, we once again have a technology
that leaves behind the limits of a thread format so that the whole
banknote becomes the playing field.
Cinema is a micro-lens feature that provides industry leading
public recognition security combined with unprecedented design
freedom. First launched on the Chaplin house note in 2019, Cin-
ema can be designed in a shape that matches the design theme,
e.g. the aperture of a camera lens.
Cinema depth and float effect combined with counterintuitive movement
float on two levels in a feature that takes the shape of the arches
of St Johns Church Byblos.
Depth and float on two different levels, within and outside the large 100
As for windowed security threads and Vivid, the design journey
of Cinema has only just begun. New ways of design integration
and above all new visual effects will make sure that lens-based
technology will become a true contender for the crown of overt
banknote security features.
Graphic Micro text No print
ibda INSIGHT 21

IBDA NEWS
Overview
The IBDA has suffered in the same way as most industry organ-
isations in 2020/21 due to our inability to stage physical events
and interface directly with our Members and Partners. Like many,
we have now adopted a virtual platform to facilitate communica-
tion and event management and we sincerely hope this will be a
temporary measure.
Our programme of events in 2021/22 outlined in this section of
IBDA Insight Vol.21 is designed to address this situation and at
the same time, avoid damaging the quality and unique attributes
of our events that have been built upon community, focus and
sharing. We aim to keep our Members and Partners connected
via a mix of virtual events, home/office-based projects and pro-
gressively as we come to the end of 2022, a migration back to a
physical format for our activity.
Partner & Member Information
We are pleased to announce the following highlights in IBDA Part-
ner and Member statistics for 2020/21
» Membership levels hold stable at just under 300 organisations,
and individuals
» 8 Partners remain committed to the IBDA in 2021
» All IBDA affiliate Members remain on board for 2021
IBDA Update
I think most of us are now leaving the dark moments of uncertainty,
instability and reclusion experience in 2020 behind us and are
focusing on a bright future. As you are aware, the IBDA was in
no way immune to the consequences of the Covid-19 pandemic
and associated national and international confinement measures.
In 2020, we were forced to cancel all of our physical events
(Future of Intaglio Summit, World Banknote Project Review
Meeting, IBDA Seminars). We have engaged with our members
across the world to ascertain their availability to participate in
IBDA events and projects in 2021/22 and the following programme
of activity is based entirely on your input and requests.
ibda INSIGHT 21
69. IBDA NEWS // OVERVIEW
Future of Intaglio Summit
Following the postponement of the Future of Intaglio physical
event in March 2020, we finally staged the event in a virtual format
one year later. Despite many concerns, participants were incred-
ibly surprised to experience a high degree of exchange, sense of
community and a truly great moment of reconnect by all.
The Future of Intaglio Summit helped us all to refocus on the cur-
rent set of challenges confronting intaglio and those who design.
develop, products and use it. The final objective of this meeting
was to identify key issues requiring attention and action in order
to create a sustainable future for intaglio and those shareholders
involved in the intaglio process. The following summarises the
main outputs proposed follow-up points from the Future of In-
taglio Summit:
FOI Summit Outputs
» People (public & cash professionals) use intaglio
» People don’t necessarily know where intaglio is due to design
practices
» Intaglio is secure and hardly ever targeted by the counterfeiter
» New counterfeiting technologies will be problematic (3d print-
ing etc.)
» Intaglio design process is suffering from a progressive divorce
between Art & Tech
» The intaglio designer has limited opportunity to supervise
transformation of artwork into a banknote
» Current market conditions preclude reasonable intaglio design
timelines/designer follow-on, obliging a hand-off between
intaglio designer and other pre-press functions
» Intaglio design technology/tools are evolving but designers
do not have time to experiment
» Market fragmentation occurring I terms of how intaglio is man-
aged (asset vs. cost)
» Still no sustainable solution for skill/knowledge transfer bet-
ween old and new generations
» Intaglio design innovation is being pursued by independent
resources without real industry support
» Central have less and less interest in intaglio
» Central banks are more interested in other security technolo-
gies
» Intaglio perceived by stakeholders as expensive and complex
» Stakeholders want intaglio technology developers to priori-
tise cost reduction
69
IBDA NEWS // OVERVIEW
Suggested Follow–Up Objectives:
The following macro objectives can be extracted from the FOI
Summit. It should be noted that these represent goals and in no
way address the actual actions, resources, or budgets required
to achieve them. This will be addressed in a subsequent step.
» Cost
Assess hard data & initiate cost reduction projects.
» Value
IntaglioMetrics showing functional value (human/machines
counterfeit etc.).
» Rethinking Intaglio Design
Review User Experience data on intaglio to determine new
design approach.
» Innovation
Facilitate further design innovation and discovery to assess
future Intaglio design R&D.
» Skill/Knowledge Transfer
Develop new model to facilitate interface/learning by new in-
taglio designers from previous/current generations.
The FOI Summit follow-up survey was issued to all 73 delegates
to enable us frame and prioritse the next steps at the Future of
Intaglio follow-up Meeting, staged on 29 March 2021.The results
from the survey are as follows:
Q1 Please rank the following actions in order of importance for
your organisation
We are currently working with a small group of individuals to de-
velop an action plan and establish realistic goals as a follow-up
70
» Technology & Time
Intaglio technology developers to work together to develop
new forums and opportunities for intaglio designers to collab-
orate and test what is possible with tech developments.
» Intaglio Art = Emotion = Attention
Scientifically assess the proposition that intaglio art creates
user attention via emotion
» Communication
A new approach to educating and valuing intaglio must be de-
veloped (including new reach mechanisms).
» Community
Facilitate more regular and informal exchange and dialogue
between stakeholders involved in intaglio to foster and pro-
mote collective collaboration.
» Vision
Create a clear and well-defined vision of the future role, format,
and position that intaglio will occupy in the banknote design,
development and deployment process.
Q2 Please tell us how you wish to participete in executing the
FOI Action Plan
to this important meeting. We will keep you informed on progress
in future editions of IBDA Insight.
ibda INSIGHT 21
 IBDA NEWS // IBDVC

INTERNATIONAL BANKNOTE DESIGNERS

VIRTUAL CONFERENCE (IBDVC)

The IBDVC was created to foster a sense of com-

munity and afford individuals active in the domain
of banknote design the opportunity to virtually
meet, exchange and benefit from the experience of
others. Recognising the difficulties still experienced
by most of us to travel and physically meet, the
IBDA took the decision earlier this year to postpone
the 6th IBDC physical event until October 2022 and
bridge the gap by staging a virtual event to facilitate
reconnect and ongoing exchange by the design
community via the IBDVC.

The IBDVC took place from 07 - 09 June 2021 and

we were overwhelmed by the level of interest. More
than 150 delegates from over 50 nations participated
in the 3 day event, putting delegate rates at the
same level as our IBDC’s .The three-day event
consisted of a series of presentations, panel dis-
cussions and workshops addressing the theme of
banknote design and related issues.

The central theme of the IBDVC was:

Design Value –
“What Does the Customer Really
Want & How To Give it to Them”

What is design really all about?

Fundamentally, it is about creating attention. Engaging the bank-
knote user with specific messages is achieved through smart
design and via this process, Central Banks can create confidence
and trust among banknote users. This is one but not the only
priority for most Central Banks.
In this period of payment tool choice, banknote designers and
design decision-makers must orientate their resources and
activities more than ever towards creating value. Banknotes must
offer the public a unique and interesting value-proposition that
embraces and amplifies the exclusive attributes and characteristics
associated with cash. This is also true as we move upstream
through the banknote design and production process. The bank-
note value-chain does not begin with the first printing process
or substrate production. Value is created from the very moment
a designer conceptualises and develops a design idea. ‘Ideation’
in itself carries much value and when framed correctly and pre-
sented to decision-makers, it can become a valuable asset.
The designers challenge is to go far beyond treating a banknote
as a piece of graphical art and to consider all the dimensions and
ecosystems it will be used in. This approach, frequently referred
to as, Design Thinking, considers the needs and expectations of
all design project stakeholders. So, to successfully execute a new
design project and create value for all involved, one must under-
stand what the customer actually wants and have the capacity,
via smart design’ to convert this needs and expectations into a
finished product within the set of parameters and limitations ap-
plied to the project. These often include:
» Budget
» Time
» Material specifications
» Process requirements
» Cash-cycle requirements

ibda INSIGHT 21 71
IBDA NEWS // IBDVC

The IBDVC was dedicated to this highly important topic via the following Speaker Agenda:

Day 1: 07 June 2021

Time Design Value - Status Check 2021 Speaker Organisation

11.00 - 11.15h Welcome and Introduction Mark Stevenson IBDA
11.15 - 11.35h A Novel Approach to Re-imagining the Future of Cash Guillaume Lepecq Agis Consulting
11.35 - 11.55h 2021 - What Does the Customer Really Want and Value? Alan Newman De La Rue
11.55 - 12.15h Bringing Value to a New Series Design Process: Linda Rodríguez Banco de Mexico
The New Mexican Series of Banknotes
12.15 - 12.35h Back to Basics – Design is All About Attentional Competition Frank Van Der Horst DNB
& Value
12.35 - 12.55h Panel Discussion on Deign Value All All

BREAK

13.30 - 13.50h Art is our Currency Yohann Naviere Banknote Art Concept
13.50 – 14.10h Do We Still Have Time to Explore & Innovate Lukas Schuler Techurity Design
14.10 – 14.30h Can Design Technology Help Us Meet Changing Customer
Expectations & How? Barna Barabas JURA
14.30 – 14.50h Towards a Greener, More Efficient Intaglio Hervé Guillerey Koenig & Bauer Banknote
Solutions
14.50 – 15.10h Panel Discussion on Time to Explore All All
15.15h Close

Design Workshops 1 - 2

15.30 – 16.10h Design Workshops Koenig & Bauer Banknote Solutions

16.15 – 16.55h Design Workshops JURA

Day 2: 08 June 2021

Time Creating Value Speaker Organisation

11.00 - 11.15h Introduction Mark Stevenson IBDA
®
11.15 - 11.35h SPARK Flow , Stepping into uncharted territory Audrey Temin SICPA
Basile Bonadeo
11.35 - 11.55h Our approach to Intaglio and Polymer Banknotes Lachlan McDonald CCL Secure
12.15 - 12.35h Presenting Design Value to the Customer Alan Eckford De La Rue
12.35 - 12.55h Protecting Banknote Security Value: Malik Alibegovic INTERPOL
Future Threats & Challenges
12.55 – 13.15 Panel Discussion on Feature Design & Integration All All

BREAK

72 ibda INSIGHT 21
 IBDA NEWS // IBDVC

Time Creating Value Speaker Organisation

13.45 – 14.05h What is Destroying Value Today Mark Stevenson IBDA
14.05 – 14.20h Artificial Intelligence to Predict & Map Design Value Dr. Daniel Dodgson University of Birmingham
14.20 – 14.40h Telling a Story via Banknote Design Tom Badley Independent Currencies
14.40 – 15.00h Using Feature Design to Create Value for Machines Robert Morrow CPI
15.00 - 15.20h Panel Discussion All All

Design Workshops 3 - 4

15.30 – 16.10h Design Workshops De La Rue

16.15 – 16.55h Design Workshops CCL Secure

Day 3: 09 June 2021

Time Design Value - Status Check 2021 Speaker Organisation

11.00 - 11.15h HUMANIA Global Cash Community Design Initiative Mark Stevenson IBDA
11.15 - 11.35h The Future Opens its Arms to Us Carlos Almenar Diaz CCL Secure
11.35 – 11.55h Organic Algortihms Sebastien Freuler SICPA
Gregory Syrvet
11.55 – 12.15h Sincerity Tom Badley Independent Currencies
12.15 - 12.40h Solving Inequality Michelle Bonzon – Koenig & Bauer Banknote
Vuilleumier Solutions
Phillipe Mermoud
12.40 – 13.00h Collaboration on the HUMANIA Design Projects Reto Karrer KURZ

13.00 - 13.30h BREAK

13.30 – 14.00 What Will You Have in Your Wallet in 10 Years Time? Franklin Noll Noll Consulting
14.00 – 14.30 The Future: A New Set of Challenges for the Designer & Mark Stevenson IBDA
Our Community
14.30 – 14.40 Announcing the ‘Banknotes &…’ Initiative Mark Stevenson IBDA
14.40 – 15.00h Open Discussion on The Future All All
15.00h Close

The event was an incredible success and delegates enjoyed the An important component in the IBDVC was an open session on
opportunity to reconnect with counterparts from around the globe the future and how the design community must embrace significant
in an informal and convivial manner. changes in the global payments ecosystem in order to support
cash usage.

ibda INSIGHT 21 73
IBDA NEWS // IBDVC

IBDA president, Mark Stevenson explained that the primary

focus of the IBDA during the past 10 years from 2010 to 2020
was ‘Design Innovation’.

He further explained that the world is changing and that the de-
sign community must change too:

Mark Stevenson proposed that the IBDA focus would need to potentially leverage design assets in order to innovate how cash
expand and include new actors driving innovation in cash pay- is accessed, used and moved, resulting in benefits for all cash
ments. Such actors (also known as CASHTECH companies) could cycle stakeholders.

74 ibda INSIGHT 21
 IBDA NEWS // IBDVC

We cannot develop product designs without understanding the › Where do they access them from?
challenges they will face in a competitive marketplace. It is there- › Why are they using banknotes?
fore imperative that: › What are they using banknotes for?
» Cash must be designed to compete with a growing range of › How are the banknotes distributed/recycled etc.?
alternatives » Designers must discover & enable the emerging actors who
» Designers must continue to do what they are doing… but are working to make cash better
also understand: » Make Cash Better & How?
› Who is using banknotes?

To conclude, the IBDA President wrapped up the session on the required by the design community in order to build a future where
future of cash by listing the new challenges and new approach cash remains a sustainable and demanded payment tool.

We thank all 152 IBDVC participants for their participation and engage in open dialogue on subjects that will have a definite and
valuable contributions. The success of the IBDVC clearly demon- significant impact on the way we design and use cash in the
strates the ongoing desire by our community to exchange and future.

ibda INSIGHT 21 75
IBDA NEWS // NEW PERSPECTIVE WEBINARS // BANKNOTES &….

NEW PERSPECTIVE WEBINARS

We recognise that despite confinement measures the world keeps

on moving and changing. This is highly evident in our own world
of payments and cash. More than ever we must keep a wider per-
spective on innovation and emerging trends, threats and chal-
lenges to banknotes and banknote design. We must understand
the critical link between design and future change and innovation.

To do this banknote designers and design decision-makers must

have access to the ‘bigger-picture’ on payments and emerging
technologies. The IBDA will facilitate this process via series of
New Perspective webinars that will be staged according to the
following programme:

Date/time (2021) Subject

01 September CBDC – What is it and will it have an impact on banknotes?
15 September What Makes Cash Weak - where, why and how to fix it?
29 September FINTECHS – Who Are They and Are They Having an Impact on Banknotes?
13 October CASHTECHS – A Threat or an Opportunity for Cash?
27 October Design = Art = Emotion = Attention: Creating User Attention in a highly competitive banknote landscape
10 November The Connected Banknote – Reasons Why/Why Not
24 November The Great Crypto Debate – Should Cryptos become material objects (cryptonotes) and why/why not?
08 December Design as an Enabler of Innovation: Case Studies and Proof
17 December The Future Marketspaces for Cash – What to Expect and How to Manage Getting There

These informal webinars are intended to take you to the real cussion and final conclusions with special guests who have a
issues and help you develop a more complete and comprehensive demonstrated level of expertise in the corresponding subject. Par-
understanding of how design interacts with all other moving parts ticipants can watch and interact with the webinar speakers directly
in emerging payments ecosystems. via live attendance or watch via streaming at a later point in time.

Each webinar will run for approximately 2 hours (12.00 – 14.00 To find out more about the New Perspectives series of webinars,
CET) and will involve a series of questions and answers, open dis- please send us a mail to info@ibd-association.com

BANKNOTES &….

The global payments industry has quite literally invested millions

of dollars trying to measure payment tool performance, efficiency,
cost, use cases etc. to make a case in favour of a cashless society.
Research reached an all-time high in 2020 with the vast majority
of Central Banks declaring they were engaged in some form of
CBDC study activity, an acceleration in terms of FINTECH activity,
the imminent threats posed by LIBRA/DIEM and of course, the
capacity of GAFAM to completely redefine the global payments
market.

76 ibda INSIGHT 21
 IBDA NEWS // NEW PERSPECTIVE WEBINARS // BANKNOTES &….

Countless metrics have been applied to payment transactions Once you have developed your story and linked it to cash to com-
including time, cost, user satisfaction, trust, confidence and con- plete a piece of artwork we will then consolidate all 36 pieces of
venience. Hard and soft testing methodologies have been applied art under the above headings into a range of outputs including
to derive statistics and findings that are aimed at facilitating the following:
informed decision-making. However, the payments industry
seems to have overlooked one important thing. Cash is not simply » Social Media
a functional payment tool. It represents a whole lot more to a » YouTube Channel
diverse range of people. The cultural symbolism of cash in a soci- » Website
ety is as diverse and profound as its range of uses. » Book
» Movie
Banknotes and cash in general facilitate life. The very essence of » Exhibition
our existence; shelter, food, water, education, stability and even » Exhibition Pack
family depend to a greater or lesser extent on the availability of » Conference Presentations
and ability to use cash. Cash can be associated with our emotions, » Roadshow Presentations
our successes, our failures, our history, our today and our future.
It is simply an intrinsic and deeply engrained part of our being. Banknotes &… is an appeal to Central Banks to fully recognise
the scope, reach and fundamental human impact that banknotes
Banknotes &… is a platform for these stories to be told. Stories have in society… in all our lives… that cannot be replaced or im-
of the precious moments, big and small, that cash and only cash, itated by technology. A banknote is more than a payment tool…
brings to individuals and societies but to which a simple metric it is a unique, cross-generational connection with our value sys-
cannot be applied. tem and an expression of our cultural identity.

Our goal is to demonstrate to the international central banking Banknotes &… will clearly demonstrate that while there are no
community that the debate over the future of cash cannot be won metrics to measure something that resists measurement, there
or lost based upon black and white statistics and metrics. The is probably a good reason… the value banknotes bring to each
deep-rooted sociological and psychological significance of cash and every one of us is simply immeasurable and unquantifiable
makes it a fundamental human requirement, without which, our yet clear and present.
day-to-day lives would not be the same.
For generations, cash and our affinity for it has been an unex-
To achieve this, we have created the ‘Banknotes &….’ Initiative. plainable enigma of freedom that refuses to be tamed and defies
This project is an opportunity for you and your loved ones, family, rationalisation. It is a physical connection in our real world amidst
friends, colleagues or even strangers to work together as a small a fog of virtual haze and we should not forget that almost two
group to create a piece of artwork demonstrating the link between thirds of the worlds’ population depend on cash every day to
cash and one of the following themes: survive and simply exist. Through Banknotes &… we aim to ex-
plore and discover the true value banknotes bring to society and
Tradition Travel Crisis we invite you to join us and have some fun while telling your
story of a moment in time where banknotes demonstrated their
Learning Liberty Saving incalculable value.
People Trade Poverty
Humanity Trust Prosperity We are currently developing the Banknotes &… website and we
will contact you once it is online. If you would like to find out more
Art Inclusion Government about the Banknotes &… initiative or simply register your early
Family Freedom Privacy interest in this projevt, please send us a mail to info@ibd-associ-
Fun Choice Giving astion.com.

Nature Simplicity Convenience

Culture Reliability Resilience
Emotion You Generations
Innovation Celebration Happiness
History Today Future

ibda INSIGHT 21 77
IBDA NEWS // CONFERENCES 2022
6th IBDC
Originally planned for September 2020, the 6th IBDC has been
postponed, rescheduled (for June 2021) and postponed again.
Our hallmark event will now take place in early October 2022 in
Dubrovnik, Croatia.
Our decision to postpone the physical event is based upon 3 fac-
tors:
» Ongoing travel restrictions and due to Covid-19 confinement
measures
» The concentration of banknote industry conferences and
events in the 1st half of 2022
» The results of a recent survey from our delegates (see graphic
below)
Q1 Please tell us if you would prefer the 6th IBDC to be a 2021
virtual or 2022 physical event
The Banknote & Currency Conference 2022
The IBDA will participate in the combined format Banknote & Cur-
rency Conference from 21-24 February 2022 in Washington DC.
This is a great opportunity to reestablish direct contact with many
of our Members and Partners and also represent design interests
and innovation.
On Thursday 23 February 14.00h-15.00h, we will host an Expert
Technical Discussion II: Perception Studies & Banknote Design:
Producing Actionable Information to Support Data-Driven Deci-
sion Making.
We look forward to meeting you all at the Banknote & Currency
Conference 2022.
78
In order to facilitate a degree of reconnect between our Members
and Partners we are nevertheless staging a virtual event, the In-
ternational Banknote Designers Virtual conference (IBDVC) from
07-09 June 2021. This event should be considered a stepping
stone to the physical 6th IBDC in 2022 and is primarily focused
on our community getting up to date on what has happened
with design and banknotes/cash during the Covid-19 pandemic
while addressing other critical issues such as ‘design value’ and
the future.
You can find out more about the IBDVC in an earlier part of IBDA
News 70-74.
As our first major physical event since 2020, we aim to we aim to
prioritise reconnecting, networking and direct delegate-to-dele-
gate interface and exchange at the 6th IBDC 2022. A significant
amount of time and infrastructure will be dedicated to facilitating
small group discussions, meetings and workshops in an informal
and accessible format.
Conference proceedings will consist of 4 half day sessions with
mornings dedicated to formal presentations and afternoons ded-
icated to informal exchange via the above activities.
We will tell you more about the 6th IBDC theme, exact dates and
venue shortly.
Global Currency Forum 2022
The IBDA will participate in the Global Currency Forum from 02-
05 May 2022. We are awaiting final confirmation of the exact event
programme but we will host a session on the subject of bavnknote
design most probably on 05 May 2022 in the session entitled;
‘Beautiful & Responsible Cash’.
ibda INSIGHT 21

CCL Secure’s Global Recycling Program
Wins Central Banking Award
Article by CCL Secure
A
global programme to encourage Central Banks to recycle
GUARDIAN™ polymer banknotes at the end of their life
has been recognised in a prestigious international award
for CCL Secure.
The annual Central Banking Awards are one of the highlights of
the year for the global community of central bankers and the
highly specialised businesses that work with them.
CCL Secure was awarded this year’s Currency Services Initiative
Award as a result of the company’s global support for recycling
and for wider reductions in its environmental impact.
“Naturally, we’re delighted to have received this prestigious
award,” says CCL Secure MD Neil Sanders. “It’s recognition of a
lot of hard work – over many years – that has gone into turning
our promises into reality. For us, our commitment to sustainability
runs through the entire company and will continue to be a major
focus for us, covering our entire supply chain and production
process.”
“Our GUARDIAN polymer banknotes already help to reduce the
environmental impact of cash because they last longer than
paper notes, and you don’t need to issue as many,” says Dr. Tim
Berridge, director of research and development, marketing, and
design at CCL. “Our global recycling programme – which has
been running successfully for several years now – makes our
polymer notes an even more environmentally responsible choice.”
The company’s commitment to sustainability goes beyond simply
encouraging their Central Bank customers to recycle. CCL Secure
has invested in specialist recycling facilities that make it easier
for customers to include recycling as part of their normal
processes for the management of cash.
ibda INSIGHT 21
79. TECHNOLOGY NEWS
A new recycling plant in Zacapu, Mexico is the latest addition to
the company’s global recycling capacity. “We can now provide a
full end-to-end service for our Central Bank clients in the region,”
says Berridge. “Globally, more than 90% of GUARDIAN polymer
banknotes issued into circulation are now recycled. We’d like to
make it 100%.”
As well as introducing programmes and building facilities that
make recycling of polymer banknotes more sustainable, CCL
Secure has invested in reducing the environmental impact of
their production processes.
Recent changes to processes in the company’s plant in Wigton,
England, for example, have achieved a 50% reduction in the use
of gas. The £40m site was purpose-built to make highly secure
GUARDIAN polymer substrate for banknotes used by the Bank
of England and other banks, using a specialist Clarity™ C polymer
created on-site by Innovia Films. Both companies are part of the
global CCL Industries group.
Enhancements made to the process mean that some of the
solvents that would otherwise be released into the atmosphere
are now captured and used for power generation. The power
generated from recaptured solvents goes towards operating the
plant’s printing press which uses electricity generated from gas
and steam. By recapturing solvents for use in power generation,
gas usage has been cut by 50%.
Air quality, both inside and outside the plant, has also been sig-
nificantly improved with emissions to air consistently well below
permitted environmental discharge consents. Prior to starting
the project, average values for carbon monoxide, volatile organic
compounds (such as carbon), and nitrogen oxides would con-
sistently be greater than 80 mg/m3. Post project, these average
values have been consistently below 20 mg/m3.
79
TECHNOLOGY NEWS // CCL
Berridge says CCL will continue to push its sustainability mandate,
but as each country’s situation is different, a one-size-fits-all so-
lution is not possible. “I think it will be a mixed approach, and
CCL Secure will work closely with users of GUARDIAN to ensure
we get the right solution for them,” he says.
80
“Whether it’s enabling our customers to recycle or enhancing our
own processes, as a responsible supplier and employer, our duty
is to make sure that what we do minimises our impact on our
shared environment. We’re committed to reducing the impact
wherever we operate, whether that’s in England, Australia, or
Mexico,” adds Neil Sanders.
ibda INSIGHT 21
 81. THE END OF CASH — MYTH OR REALITY

THE END OF CASH —

MYTH OR REALITY

THE FUTURE OF BANKNOTES:

PHYSICAL, DIGITAL OR HYBRID?
Dr. Franklin Noll – President, Noll Historical Consulting
Andrei Lipkin – Director of Innovative Technologies, Noll Historical Consulting

W e are heading for a cashless world. At some point, we will

say goodbye to all those pieces of paper and polymer and
switch to an electronic alternative. The only problem with these
statements is that people have been saying them since the late
1960s. Banknotes have a robust technology and will be around
for quite some years to come. What is needed is a transitional
device that will ease the transition from nineteenth-century cash
to twenty-first-century digital currency. The answer is a hybrid
banknote. Basically, a hybrid banknote is a physical banknote on
a paper or polymer substrate that can transfer value over an elec-
tronic network. It is denominated and has all the physical
properties of a traditional banknote, allowing it to pass hand to
hand. However, when the need arises, the user can access an
electronic network and transfer the denominated value off the
hybrid banknote.
THREE HYBRID BANKNOTE OPTIONS FOR TODAY
Building upon the past and incorporating current technology and
developments in the cash and payment worlds, we present the
most promising hybrid banknote models for CBDC and cryp-
tocurrency use today.
First is a smart banknote, a traditional banknote that has the
added ability to communicate with an electronic network via chip
technology, which can operate on a central ledger or a blockchain.
The second and third models are variations of a cryptobanknote,
which uses QR codes and is reminiscent of a paper wallet and is
based on blockchain technology. Two types of cryptobanknotes
are possible: cryptonotes and cryptobills.
banknote conveys value without the need to connect to an elec-
tronic network. However, a smart banknote is capable of convey-
ing its value over an electronic network, acting as an electronic
payment vehicle.
This hybrid banknote talks to an electronic network via one or
more RFID chips. Using a smart phone, a point of sale device, of
other reader, the value of the smart banknote can be moved back
and forth on an electronic network. Value can be transferred off
of a smart banknote onto a network, or value can be transferred
from a network on to an “empty” or valueless smart banknote.
The status of the smart banknote, whether it contains its face
value or not, whether it is “empty” or not, is indicated by a tactile
and visible icon formed by electronic ink.
A smart banknote would appear much like existing Dollar, Euro,
or Pound banknotes. The same substrate, intaglio and offset
printing, denominators, security features, and overall design could
be maintained from existing notes. And, depending on the chip
technology employed, the chips may be largely invisible. The
icon, indicating the note’s status, could be an existing design
feature or new feature worked into an existing design.
Imagine a $10 US smart banknote. It will appear as a regular $10
bill but may have a tiny chip or two visible in the substrate. The
status icon could be the current Symbol of Liberty in the design:
The Statue of Liberty Torch.

Smart Banknotes
A smart banknote is like a traditional banknote in that it bears in-
taglio and offset printing on a paper or polymer substrate. Like a
traditional banknote, a smart banknote conveys its value without
a network or electricity. It can work completely offline. Its visible
denomination presents its discrete value, prima facie. A smart
$10 Federal Reserve Note

ibda INSIGHT 21 81
THE END OF CASH — MYTH OR REALITY
This smart $10 bill would circulate hand-to-hand like a current
$10, being used in face-to-face transactions or fed into vending
machine bill acceptors. No access to an electronic network is
necessary. Everyone would know that this $10 bill contains its
value because the torch symbol is colored and raised above the
surface of the note. With this tactile feature, even the visually im-
paired can gauge the status of the note.
$10 Federal Reserve Note, Symbol of Liberty Highlighted
Perhaps the smart banknote user then needs to complete an
electronic transaction. They want to transfer the $10 to their bank
account, transfer it to a distant relative, or make a transaction at
a point that does not accept cash. The user touches the note to
their phone or point of sale device and transfers the value over
the network.
The value icon or The Statue of Liberty Torch symbol then disap-
pears, indicating visually and tactilely that the smart banknote no
longer has value; it is “empty.” The user can then turn in the smart
$10 bill to a bank or merchant that will recharge the note and rein-
troduce it into circulation. Or, the user can hold on to the smart
banknote and recharge it themselves by transferring $10 back on
to the bill. At this point, The Statue of Liberty Torch symbol would
appear, indicating that the smart banknote bears its face value.
And, the smart $10 can continue circulating hand-to-hand.
Cryptobanknotes
A cryptobanknote is also a hybrid banknote. It is a traditional
banknote that conveys the value of a digital money but cannot in-
teract directly with an electronic network. But, it is modeled on a
paper wallet as used with cryptocurrency, usually bearing the pri-
vate and public keys needed to access a cryptocurrency address.
Like a traditional banknote, a cryptobanknote conveys its value
without a network or electricity. It can work completely offline. Its
visible denomination presents its discrete value, prima facie. A
cryptobanknote conveys value without the need to connect to an
electronic network. However, when needed, the value of a cryp-
tobanknote can be transferred over an electronic network, using
the keys located on the note. Two types of cryptobanknotes are
possible: cryptonotes and cryptobills.
82
Cryptonotes
A cryptonote is a hybrid banknote that bears the public and pri-
vate keys to access a cryptocurrency account. Cryptonotes can
pass hand-to-hand until a user wants to transfer the value of the
note to an electronic account. This action will “burn” or invalidate
the note, making it incapable of further use. Hence, a cryptonote
can be considered single use as regards the electronic transfer
of its value.
It would require a design somewhat different from existing Dollar,
Euro, or Pound banknotes. It would use a banknote substrate,
use intaglio and offset printing, and bear denominators and se-
curity features like existing notes. However, the note would require
a QR code and a location for a removable foil or other concealing,
tamper-evident device.
A £10 note, for example, would bear all the attributes it now has,
but the silver foil patch (bearing the crown, top-left) would be re-
movable. Underneath of it would be the private key in QR form.
The hologram (bearing “Ten,” bottom-left) would be replaced with
a visible QR code that would be the public key.
£10 Note
Like a current £10 banknote, the £10 cryptonote would repeatedly
pass hand-to-hand and be used in face-to-face transactions or
fed into vending machine bill acceptors. No access to an elec-
tronic network is necessary. Everyone would know that this £10
contains its value because the foil patch is intact, evidence that
no one has accessed the private key necessary to transfer its
value electronically.
Perhaps, the cryptonote user then needs to complete an elec-
tronic transaction. They want to transfer the £10 to their bank ac-
count, transfer it to a distant relative, or make a transaction at a
point that does not accept cash. The user scratches off the foil
patch to reveal the private key. Then, using their phone or point
of sale device, the user scans the QR codes for the public and
private keys, accessing the corresponding wallet. The £10 can
then be transferred.
Now, with the foil patch removed and the value removed from the
note, the cryptonote can no longer be used. And, because of the
physical damage to the note, it cannot be reused. The lost foil
patch also makes it evident to everyone, including the visually
impaired, that the note no longer has value.
ibda INSIGHT 21

Cryptobills
A cryptobill is a hybrid banknote that bears only the public key of
the cryptocurrency holdings of the issuer. The private keys to in-
dividual accounts are held by the note issuer. Cryptobills can
pass hand-to-hand until a user wants to transfer the value of the
note to an electronic account. The note must then be taken to
the issuer or its representative to have the value represented by
the note transferred. This action does not involve the actual note
but only the cryptocurrency accounts holding the backing value
for all cryptobills. As a result, the note can be reissued repeatedly
and circulate until worn out.
A cryptobill takes as its model past banknotes used in the United
States such as Silver Certificates and Gold Certificates. Such bills
were certificates of deposit with the banknote representing a cer-
tain amount of the backing silver or gold held in the US Treasury.
A holder of a Silver Certificate and Gold Certificate could go to
the Treasury and turn in the note for the backing silver or gold.
After accounting for the payout of this specie in its books, the
Treasury would reissue the note for continued circulation until the
note was worn out or all the backing silver or gold was depleted.
A cryptobill acts in the same way. Only, here, the backing is a
cryptocurrency.
It would require a design very similar to that of an existing Dollar,
Euro, or Pound banknote. It would use a banknote substrate, use
intaglio and offset printing, and bear denominators and security
features like existing notes. However, the note would require a
QR code, bearing a public key. No chips or removable foil
patches.
Like a current banknote, the cryptobill would repeatedly pass
hand-to-hand and be used in face-to-face transactions or fed
into vending machine bill acceptors. No access to an electronic
network is necessary. As with current banknotes, there is no need
to determine whether the note actually holds value, because it is
irrelevant. A cryptobill, like a current Dollar, Euro, or Pound, is
simply a token for its underlying currency. As a result, users are
only concerned with the authenticity of the note as they are with
current banknotes.
Cryptobanknote Model by Andrei Lipkin
ibda INSIGHT 21
THE END OF CASH — MYTH OR REALITY
CONCLUSION
Hybrid banknotes may seem new and radical, but they are not
the first instruments to act as hybrid instruments. During the
1970s, hybrid US Treasury securities existed. These securities
were meant to bridge the transition from physical (definitive) se-
curities to electronic ones handled in the new book-entry system.
This began with Treasury Bills and was slowly expanded to
include Notes and Bonds. These physical securities were entered
in the book-entry system but were still issued in paper form
bearing their CUSIP numbers. This was a hybrid, transitional se-
curity able to work in both worlds. Given that 50 years ago the
US Treasury was issuing hybrid securities (part definitive, part
electronic), it does not take a great stretch of the imagination to
believe that a hybrid banknote could be produced today, acting
as a transition between definitive and electronic cash.
Transcending the division between the world of banknotes and
electronic money through a hybrid banknote will bring many ad-
vantages to central banks and cryptocurrency advocates. Such
banknotes will use a universally accepted and robust payment
technology, cash, to deliver the cutting-edge benefits of digital
money, passing hand to hand until used to access an electronic
network to transfer value.
Hybrid banknotes can provide anonymous, offline transactions,
using a familiar technology. At the same time, they can promote
the adoption of digital money and facilitate central bank monetary
policies possible only with CBDCs. All this can be done while
maintaining the health of the cash industry and meeting the pop-
ular demand for cash.
Also, the use of one form of hybrid banknote does not preclude
the use of another. Smart banknotes, cryptonotes, and cryptobills
can all be used together, serving specific purposes within the
same currency. Some issuers may want to use full-feature notes
like smart banknotes and cryptonotes for high denominations and
use simpler cryptobills for low denominations. And, there may be
times, such as during disaster relief, when a single-use note (such
as a cryptonote) or a note that can be activated onsite (such as
a smart banknote) are preferable. Hybrid banknotes provide many
options.
Since their inception in 2010, hybrid banknotes have taken many
forms but shared many characteristics. These commonalities stem
from the notes having the same overall mission, to create a device
that brings together the world of cash and traditional banknotes
and the world of cryptocurrencies and electronic networks. These
devices were designed to solve a myriad of payment problems
that are still with us today and will be into the future.
83
THE END OF CASH — MYTH OR REALITY
THE GLOBAL PAYMENTS REPORT
GLOBAL
PAYMENT TRENDS
C onsumer payment preferences vary considerably around the
world, reflecting an infinite diversity of historical, technical,
cultural, economic and regulatory factors. Alternative payment
methods like digital wallets and bank transfers are now in the
mainstream, if not in the outright majority, and legacy methods
like credit cards and cash continue to decline.
Widespread disruptions created a profound shift in commerce
and payments, accelerating the adoption of digital wallets in e-
commerce while hastening the decline of cash at the point of sale.
Digital wallets thrive as e-commerce surges
E-commerce exploded in 2020 to post the highest growth rate in
five years as home-bound consumers sought alternatives to
shuttered brick-and- mortar stores. Global e-commerce growth
accelerated in 2020 despite recessionary headwinds, posting
U.S.$4.6 trillion in transactions, a 19% increase from 2019. This
growth accelerated the rate of e-commerce penetration by almost
three years, with total transactions jumping from 8% in 2019 to
10% in 2020.
84
Digital wallets remain the payment method of
choice among global e-commerce consumers,
accounting for 44.5% of e-commerce trans-
action volume in 2020, up 6.5% from 2019.
Chinese consumers lead the way with digital
wallets, accounting for 72.1% of e-commerce
purchases. In the U.S. – where digital/mobile
wallet adoption lagged global averages – digital
wallets grew to represent 29.8% of e-com-
merce transactions, up 23.7% over 2019 levels.
Digital wallet gains in e-commerce came largely
at the expense of credit cards, bank transfers
and cash on delivery (COD). Our projections
expect digital wallets to account for 51.7% of
e-commerce payment volumes by 2024 with
slight declines in credit cards (to 20.8%) and
debit cards
(to 12%). By 2024, digital wallets, credit and debit cards will ac-
count for 84.5% of e-commerce spend. Buy now, pay later
(BNPL) continues to earn market share, expecting to double from
2.1% in 2020 to 4.2% by 2024.
One new component of our 2020 e-commerce analysis is direct
debit. Direct debit is a form of bank transfer where a retailer
withdraws funds directly from a consumer’s bank account on a
specified date after the purchase. Most popular in Europe where
it earned 4% of share, direct debit was used for 1.2% of global
e-commerce payments in 2020.
ibda INSIGHT 21

Cash bids a hasty retreat amid POS contraction
Point-of-sale felt the impact of COVID-19 most directly, with 2020
global transaction volume falling 4.4% from 2019. Projections see
recovery from the global recession transaction volumes taking
18-24 months, returning to 6.5% global growth rates in 2022, and
then 3.3% growth in 2023 and 3.5% in 2024.
Disruptions in payment types were as equally dramatic as the
reductions in total volume. COVID-19 is accelerating the pace of
cash’s decline faster than even the most bullish projections. The
pandemic accelerated the decline of cash by over three years,
exceeding in 2020 our previous projection for 2023. Cash was
used for 20.5% of global POS volume in 2020, a 32.1% reduction
from 2019.
Cash transaction values fell steeply around the world in 2020: by
21.9% in North America, 33.6% in Europe, 34.7% in Latin Amer-
ica and 36.6% in APAC. Cash has fallen to historically low usage
around the world, representing only 5.4% of POS transaction vol-
ume in Canada, 4.5% in Norway, 11.9% in the U.S. and less than
10% in markets as diverse as Australia, Hong Kong and Sweden.
Mobile wallets gained much of cash’s share loss at the point of
sale, rising 19.5% over 2019 to represent 25.7% of 2020 POS
transactions. The pandemic ushered in a wave of interest in con-
tactless payment methods, accelerating already growing interest
in mobile wallets.
Numbers adjusted for rounding may impact totals.
ibda INSIGHT 21
THE END OF CASH — MYTH OR REALITY
Credit cards (22.4%) and debit cards (22.3%) continue to earn
majority shares of POS payments in Europe, Latin America and
North America, while seeing comparatively less use in APAC and
MEA.
A new category in our POS 2020 analysis is POS financing, which
represents a mix of legacy and emerging payments that extend
consumer credit at the point of sale. This includes credit offered
by retailers, financial institutions, marketplaces and BNPL serv-
ices. The spectrum of POS financing is broadening consumer
payment choices while boosting merchant conversions. POS fi-
nancing represents 3.5% of global 2020 POS share, projected to
maintain fairly steady share at 3.3% in 2024.
Looking ahead to 2024, we expect the trend away from cash to
continue as consumers cement their preferences of more con-
venient, contactless payment methods at the point of sale. While
accelerating cash’s decline, we do not expect a significant cash
bounce-back – regardless of COVID- 19’s ultimate trajectory. We
project cash will decline an additional 38% from 2020 to represent
just 12.7% of global POS volume by 2024.
The loss of cash will be absorbed by mobile wallets with expec-
tations they will rise an additional 30% from 2020 to account for
33.4% of global POS spend by 2024. Mobile wallets will earn
shares in the mid-teens across all global regions by 2024, led by
the outlier of APAC where mobile wallets will achieve majority
status, earning 47.9% of POS share by 2024. Though shifting
within regions, card shares will hold steady through 2024 at roughly
50% of global POS transaction values.
*Forecasted
85
THE END OF CASH — MYTH OR REALITY
UK CASH ACCESS CRISIS
By Matt Patchett 17 Feb 2021 / Courtesy of which.co.uk
The UK’s largest retail banks have made pub-
lic commitments to protect the cash network,
as the need for legislation becomes urgent.
A nabel Hoult, Which? chief executive, wrote
to each of the banks outlining the fragile
state of the cash ecosystem and asked them
to make a pledge to help maintain cash access.
While all the banks responded positively, the
varying timeframes of their commitment un-
derline the critical need for government action.
In last year’s Budget, legislation was announced
to protect cash for consumers, but there’s still
no timetable in place for its introduction. Urgent
action is required to ensure the long-term
future of the cash system in the UK.
What did we ask banks to do?
Which? wrote to the banks asking them to guarantee continued
membership of schemes managed by Link, the UK’s largest cash
machine network, and the Post Office, which are critical to pro-
tecting the current provision for cash withdrawal until legislation
is introduced. Reassuringly, banks pointed to the importance of
safeguarding the cash network for cash-dependent customers.
There was general agreement that both Link and the Post Office
have a crucial role to play in the short to medium-term future.
However, all of the responses stopped short of explicitly commit-
ting to either scheme until legislation is introduced. This is largely
due to the lack of clarity on the timing of the government’s plans.
What does this mean for the cash network?
It’s encouraging that some banks have made commitments until
they expect legislation to pass. However, without clear direction
from the government on the future of cash, it is unclear what will
happen if timetables exceed banks’ expectations. Which? is con-
cerned that banks are unable to commit to anything beyond their
existing agreements and is calling on the government to urgently
set out a roadmap for protecting access to cash for those who
depend on it. There is a risk that if this roadmap isn’t set out as
soon as possible, irreversible damage could be done to the UK’s
cash infrastructure in the interim. If even one bank was to with-
draw support from either Link or the Post Office, with the latter’s
agreement with banks ending at the end of next year, widespread
cash access will no longer be viable.
Why does this matter?
Recent research from Which? shows that there are two and a
half million people in the UK who are reliant on cash to pay for
essential products. A further seven million people say they would
struggle without cash. Despite the fact that 10 million aren’t ready
to lose access to cash, the cash network continues to shrink.
86
Since the start of 2020, 3,300 free-to-use cash machines have
closed across the UK, with 431 banks closing over the same pe-
riod, at the rate of a bank a day.
The overall number of ATMs in the UK has fallen by almost 20%
in the past three years from 67,300 to 54,400. The number of
bank branches has fallen by 40% – from 9,900 to 6,000 – since
2015. While a Post Office is not a perfect substitute for a bank, it
can offer essential cash services in communities that have no
other means of access. Find out more: one in three have had
cash payments refused during the pandemic.
What happens next?
The pandemic has piled further pressure on the UK’s cash infra-
structure, which has been hit by a sharp decline in businesses
accepting cash and the closure of thousands of ATMs and bank
branches over the past 12 months. Which? is now urging the
government to publish its vision for the future of cash. The gov-
ernment must work with industry and regulators to set out the
steps that will be taken to develop and introduce legislation at
the earliest opportunity. As part of this, the government must
also give the FCA the responsibility to oversee the protection of
cash in the UK to ensure that it remains a viable payment option
for as long as it’s needed. Anabel Hoult, Which? chief executive,
said: ‘The rapid shift to a cashless society threatens to cut off
access to those who depend on cash to pay for essential
products and services. ‘It’s reassuring that all the major banks
have reiterated their commitment to protecting cash for these
customers, but without a clear indication of when legislation will
be introduced, there remains significant uncertainty for what this
might mean in the not too distant future. ‘The government must
set out a roadmap for legislation at the earliest opportunity to
ensure that cash remains a viable payment method for as long
as it is needed.’
ibda INSIGHT 21
 THE END OF CASH — MYTH OR REALITY

WITH THE ECONOMY AT A STANDSTILL,

ATM AND CASH USE DECLINED

D uring the pandemic, the number of ATM transactions in the

LINK network (the largest ATM network in the United King-
dom) dropped a staggering 43%, going from 2.61 billion in 2019
mas, convenience stores) and shutdown ATMs in bank branches
and supermarkets to comply with public health guidelines.

to 1.64 billion in 2020. Early in the pandemic, ATM transactions
declined 41%, but then partly recovered in summer 2020 as
authorities lifted restrictions and dropped again in the winter as
authorities imposed a new lockdown
According to LINK surveys, 74% of U.K. consumers reported
using less cash during the Covid-19 pandemic than before.
Nearly a fifth of those surveyed said they had been discouraged
by other people to use cash, and 10% reported that some of the
businesses they shopped at had gone entirely cashless. A Bank
of England survey from July 2020 showed that 42% of people
had visited a cashless store in the previous six months. Another
poll showed that 34% of respondents said they could not pay
using cash at least once since the pandemic started, particularly
in grocery stores, pubs, and restaurants.
BUT THE U.K. PUBLIC STILL DEMANDED BANKNOTES,
PANDEMIC NOTWITHSTANDING
In value, ATM withdrawals declined less than in volume with a
36% drop, going from £116 billion in 2019 to £81 billion in 2020
(LINK 2021: 2). People might be spending less, but they store
more cash: the average withdrawal value grew from £67 in 2019
to over £85 in 2020. This data point reflects an increase in bank-
note demand as a reliable store of value and reserve amid crises,
as has happened in other countries during the Covid-19 pan-
demic, such as Argentina, Australia, the European Union, the
United States, Japan, and Colombia, among others.
It is an open question as to how many ATMs will come back
online as lockdown measures ease and economic activities return
to normalcy. The Covid-19 pandemic threatens the ATM network’s
economic viability, already weakened by the closure of nearly
half of British bank branches since 2000.
PRESERVING COMMUNITY ACCESS TO CASH
The situation has prompted several experiments to preserve the
sustainability of cash for users and small businesses, such as the
Community Access to Cash Pilots and LINK’s Community Access
to Cash Delivery Fund. Natalie Ceeney, lead author of the Access
to Cash Review, says, “These pilots are designed to find sustain-
able ways to keep cash viable locally, which, if successful, can
then be rolled out more widely.” Even Visa has enacted a program
to pay shops to offer cashback in rural locations in the United
Kingdom.
Cash access in rural and remote areas is critical for retail pay-
ments. According to Enryo, over 11.6 million adults frequently
use cash for day-to-day spending, representing 22% of the U.K.
adult population (Cash in the U.K. 2020: 12-13). It is estimated
that over 8 million adults (17% of the U.K. population) would be
unable to cope or are unsure of how they would cope with a
cashless society (Access to Cash Review 2019: 6, 45).

Bank of England data shows that cash in circulation increased by

£5 billion in 2020 or 6.7%. Interestingly, Northern Ireland consumers
had the highest withdrawals in the United Kingdom (£2,124 per
adult in 2020), arising from heightened uncertainty relating to the
Covid-19 pandemic and the region’s fate after Brexit.

THE PANDEMIC REDUCED THE ATM NETWORK

The number of ATMs in operation contracted nearly 9.9%, from

60,600 in January 2020 to 54,574 ATMs in December of last year.
The number of pay-to-use ATMs declined 16%, going from
15,323 in January to 12,847 in December 2020. Most worryingly,
free-to-use ATMs went from 54,500 in January 2018 to 41,500 in
January 2021, a fall of 24%.

The reduction resulted from offline ATMs in closed premises (such

as high streets, city and shopping centres, airports, pubs, cine-

ibda INSIGHT 21 87
THE END OF CASH — MYTH OR REALITY
Pilots include “bank hubs” offered through the U.K. Post Office,
white-label branches such as the OneBanks initiative, and other
CashTech solutions. In autumn 2020, LINK and PayPoint (a pay-
mentservices and ATM provider) launched a Cash-in-Shop pilot
allowing consumers to obtain cash in small shops without making
a purchase. Traditional cashback is the second most used method
for withdrawing cash in the United Kingdom, just behind ATMs.
In Denny, Scotland, a convenience store owner told the BBC that
his town “used to have a TSB [Trustee Savings Bank], a Royal
U.K.: CAN BANK HUBS SOLVE
THE ACCESS TO CASH CONUNDRUM?
Published in: Access to cash, Commercial bank, Shared infrastructure, UK, United Kingdom
Bank hubs jointly operated by the 5 leading banks and the Post
Office are the latest U.K. initiative to ensure access to cash
services for individuals and businesses in a viable way. Eight
pilots are currently being trialled across the U.K.
I n March 2019, the Access to Cash Review commissioned by
Link, the UK’s ATM network concluded that “Sleepwalking into
a cashless society will leave millions behind. Action is needed
now.” Bank of England data shows that cash in circulation in-
creased by £5 billion in 2020 or 6.7% as many consumers have
increased their cash holdings in times of crisis.
Graph 1. United Kingdom: Number of Bank and Building Society Branches, 1986-2020.
Sources: British Bankers’ Association (BBA); Office of National Statistics (ONS); UK Business Counts – local units, via NOMIS
88
Bank of Scotland, a Bank of Scotland, a Clydesdale Bank.
They’ve all shut.” He has seen an increase in sales from people
picking “up a juice, or a pack of cigarettes” when they withdraw
cash. However, his top priority is to help the elderly and the vul-
nerable members of his small town. “I think it’s just a community
thing where we try to help and give back something. [People] who
are on benefits here want access to their cash. […] If someone
on benefits has only got £3.50 left in their bank account and they
want that £3.50, I can give them that £3.50, and it is not going to
cost them anything,” he said.
BANK BRANCHES HAVE DECLINED BY 28% SINCE 2012
Maintaining an infrastructure to access cash has been identified
as a critical issue. According to data published by the House of
Commons, the number of bank branches has been falling
steadily. In March 2020, there were 9,560 bank branches or build-
ing society branches in the U.K., a 28% decline since 2012 (see
Graph 1). In addition, there were 11,638 Post Offices, which often
act as an alternative to bank branches.
ibda INSIGHT 21
 THE END OF CASH — MYTH OR REALITY

According to Link, who operates the vast majority of cash 2). The numbers for 2020 do not include ATMs that were temporarily
machines in the U.K., the total number of ATMs peaked at 70,588 closed due to the coronavirus crisis.
in 2015 and has dropped to 54,574 at the end of 2020 (see Graph

Graph 2. United Kingdom: Free to use ATMs (blue) and pay to use ATMs (red), 1998-2020.

Source: Link.

EIGHT BANK HUBS ARE BEING TRIALLED

The five leading British banks (Barclays, Natwest, Lloyds, San-

tander, and HSBC) and the Post Office are trialing bank hubs
across eight communities to ensure residents and businesses
have access to cash. The hubs include an ATM, a cash deposit
machine (CDM), and the banks each provide a staff member one
day per week to assist with more complex transactions.

The range of services available depends on each of the banks

but it currently includes recovering lost passwords and user-
names, reporting lost bank cards, and setting up standing orders.
Natalie Ceeney, who launched the Community Access to Cash
Pilots scheme, says more services are likely to be added as the
banks find out what the customers want through the pilot.
The BBC quoted the postmaster of one hub: “One lady came in to
say ‘thank you, you have changed my life’, and that’s not an
understatement.” “It is hard to find anyone – young or old – who is
not relieved to have the new hub in town” adds journalist Kevin
Peachey.
This is not the first time British banks attempt to open bank hubs.
In March 2019, Lloyds Banking Group, Royal Bank of Scotland,
and Barclays launched a jointly-run mini bank branches for its
business customers. Bank hubs are popular in Latin America and
enable banks to offer services in areas where they lack the critical
mass to operate a branch in a profitable way.
In a separate initiative, startup Onebanks is launching kiosks that
provide bank-agnostic services in convenient locations such as
supermarkets. The kiosks operate as white-label branches for
every bank. The kiosk offers everyday banking from cash with-
drawals, deposits, bill payments, transfers, to support and face-
to-face conversation with human beings. Services to customers
are free of charge.
Regulators have also been urging banks to reconsider branch
closures. The Financial Conduct Authority has called on banks
to reconsider branch closures amid fears that vulnerable customers
could be left without access to services. The new Financial
Services Bill which received Royal Assent on 29 April also aims
to improve access to cash by making it easier for retailers of all
sizes to offer cash back without a purchase.

ibda INSIGHT 21 89
THE END OF CASH — MYTH OR REALITY
ECB SETS UP WORKING GROUP ON
ACCESS TO AND ACCEPTANCE OF CASH
April 26, 2021 / Article Courtesy of CashEssentials
The Euro Retail Payments Board, which is chaired by the ECB,
has set up a working group to tackle access to and acceptance
of cash, amidst growing concerns that cash services could be-
come difficult as the network of access points diminishes..
T he Euro Retail Payments Board (ERPB) is a high-level strate-
gic body tasked with fostering the integration, innovation and
competitiveness of euro retail payments in the European Union. It
was launched in 2013 by the ECB and is chaired by ECB Execu-
tive Board Member Fabio Panetta and gathers representatives of
payment service providers as well as users of payments services
(consumers, merchants, administrations).
Sources: Authors’ calculations based on the 2016 SUCH study, ECB (2019), De Nederlandsche Bank and the Dutch Payments
Association (2019) and Deutsche Bundesbank (2019).
“As euro banknotes and coins are legal tender, it is an
essential precondition that citizens have good access
to them, and that retailers have good cash deposit fa-
cilities.” ECB President Christine Lagarde.
90
In November 2020, the ECB submitted a paper on access to cash
to the ERPB, highlighting that between 2016 and 2019, the num-
ber of bank branches declined by 12% and the number of ATMs
by 4.3% in the euro area. The ECB 2020 Study on the Payment
Attitudes of Consumers in the Euro Area (SPACE) showed that in
2019, almost 10% of respondents considered that access to an
ATM is fairly or very difficult, twice the number since 2016. Cash
acceptance at the POS is still high in most euro area countries,
but in a few countries, it can no longer be said that cash is uni-
versally accepted.
The Eurosystem has developed a common methodology to
measure access to cash based on two metrics – distance to and
capacity of cash access points – and a euro-area analysis is
being a carried out. Cash access points are currently defined as
bank branches and ATMs, as alternative services such as cash-
backand cash-in-shop are considered as complimentary alterna-
tives but not full substitutes.
ibda INSIGHT 21
 THE END OF CASH — MYTH OR REALITY

In February, the ERPB established a working group to analyse
access to and acceptance of cash. The Working Group is con-
ducting a stock-taking exercise of various ongoing initiatives by
relevant stakeholders and identifying gaps not yet addressed and
deserving further investigations and a report is due by November
2021. The report will cover:
1. Overview of the factors influencing the bank branch and ATM
networks (credit institutions and, where applicable, IADs) and
description of possible future initiatives how to avoid cash
supply deficits, for example in rural areas;
2. Overview of various initiatives aiming at ensuring adequate
cash withdrawal and lodgement facilities, especially for smaller
and medium sized enterprises (which usually do not contract
CITs to take care of cash lodgements/withdrawals and need
to rely on “local” cash services);
3. Overview of obstacles regarding the acceptance of cash and
initiatives aiming to ensure acceptance of cash also in the fu-
ture; and
4. Overview and evaluation of alternative ways where other ac-
tors (e.g. retailers, post offices) could offer services to provide
access to cash (i.e. cashback, cash-in-shop etc.), including
possible obstacles hindering such cash services.
The working group gathers relevant stakeholders, including rep-
resentatives of ERPB members. The working group is co-chaired
by the AGE Platform Europe – a European network of non-profit
organisations of and for people aged 50+, which aims to voice
and promote the interests of the 200 million citizens aged 50+ in
the European Union – and the European Savings and Retail
Banking Group (supply side).
Access to cash is being reviewed in an increasing number of
countries. In January, the Swedish government has announced
a special investigation into the role of the state in the payment
market and take position on what the role should look like in the
future. In the UK, the Access to Cash Review was launched in
July 2018 to look at the future of access to cash across the UK
and published its final report in March 2019. In December 2020,
the Dutch Central Bank commissioned a study on the cash infra-
structure for the medium-term. In France, the central bank along
with the treasury is launching an initiative to ensure equal access
to cash throughout the territory.

MEXICO: CASH IS ALIVE AND WELL

April 27, 2021 / Article Courtesy of CashEssentials

Cash in circulation grew 30.33% in Mexico during the Covid-

19 pandemic, driven by large-denomination banknotes. ATM
transactions declined in volume but rose an impressive 15.9%
in value. Mexico’s cash infrastructure has expanded despite the
pandemic.

A ccording to Bank of International Settlements’ (BIS) data,

Mexico’s cash in circulation grew by 42.5% between 2015
and 2019. Anticipating a sustained growth in the demand for
cash, Banco de México (the country’s central bank) opened a
second banknote printing facility in El Salto, Jalisco, in 2018. That
same year, Mexico’s ratio of cash in circulation to GDP was 6.9%,
equal to the median and slightly lower than the 8% average in
the most recent BIS comparison available.

THE MEXICAN CENTRAL BANK DID NOT RECOMMEND

USING CASH LESS DURING THE COVID-19 PANDEMIC

As SARS-CoV-2 spread throughout the world, Banco de México

advised cash holders to “wash their hands correctly and fre- the Asociación de Bancos de México (ABM, Mexican Banking
quently, and to avoid touching their nose, eyes and mouth after Association) promoted alternatives to cash, such as the Sistema
touching any surface or object, including banknotes and coins.” de Pagos Electrónicos Bancarios (SPEI, Interbanking Electronic
In June 2020, the Mexico City local government, in alliance with Payments System) and Cobro Digital (CoDi, Digital Charging).

ibda INSIGHT 21 91
THE END OF CASH — MYTH OR REALITY
CASH IN CIRCULATION GROWS, DRIVEN BY LARGE–
DENOMINATION BANKNOTES
By the end of 2020, Mexico’s cash in circulation to GDP ratio
increased to 8.5%. Banco de México data shows that during the
Covid-19 pandemic, cash in the hands of the public has risen by
a staggering 30.33%, going from MX$1.67 trillion (US$84 billion)
on March 11, 2020, the day when the WHO declared Covid-19 a
pandemic, to MX$2.18 trillion (US$110 billion) on March 31, 2021.
The last amount would result in MX7r$17,277.35 (US$872.05) in
cash per capita, based on population data from the 2020 census.
Graph 1. Mexico: Banknotes and coins in circulation, February 2011-February 2021 (thousands of Mexican pesos)
The increase of cash in circulation in Mexico has been driven by
large-denomination banknotes, as in other countries during the
pandemic. The volume of MX$1,000 notes (US$50.47) grew
34.7%, followed by MX$500 notes (US$25.24), with 33.1%;
MX$200 notes (US$10.09), with 18.2%, and MX$100 notes
(US$5.05), with an increase of 14.21%. Other small-denomination
notes have grown a bit less or stayed the same throughout the
pandemic: notes of MX$20 (US$1.01) rose 10.9%, and MX$50
notes (US$2.52) grew 0.84%.
Graph 2. Mexico: Banknotes by denomination, January 2020-
March 2021 (billions of notes)
Source: own elaboration with Banco de México data.
CASH INFRASTRUCTURE EXPANDS SLIGHTLY; ATM TRANS-
ACTIONS DECLINE IN VOLUME BUT INCREASE IN VALUE
Despite sensational media coverage announcing the premature
death of cash and the advent of cashless payments in Mexico,
the country’s cash infrastructure has expanded during the
pandemic. The number of ATMs grew 1.3%, going from 56.63
thousand ATMs in the first quarter of 2020 to 57.4 thousand in
the last quarter of 2020. ATMs in bank branches grew 2.1%, from
27.7 thousand in January-March 2020 to 28.3 thousand ATMs in
92
Source: Banco de México.
October-December 2020. ATMs outside of bank branches increased
by 0.58%, from 28.93 thousand in 2020:Q1 to 29.1 thousand
ATMs in 2020:Q4.
Although the volume of ATM transactions declined by 2.9% dur-
ing the first year of the Covid-19 pandemic, their value increased
by an impressive 15.9%. Average ATM withdrawals increased
19.5%, going from MX$2,057 (US$103.82) in the first quarter of
2020 to MX$2,458 (US$124.06) in the last quarter.
DESPITE THE COVID-19 PANDEMIC AND THE ECONOMIC
COLLAPSE, CASH IS ALIVE AND WELL IN MEXICO
In 2020, the Mexican economy contracted 8.5% in seasonally
adjusted terms, its largest fall since 1932, during the Great De-
pression. As we can see with the most recent data, cash is alive
and well in Mexico, despite the economic collapse.
There are several explanations for the significant growth in the
demand for cash during the Covid-19 pandemic:
» According to Banco de México Governor Alejandro Díaz de
León, a substantial increase in average ATM withdrawals stim-
ulated the demand for cash.
» Enrique Quintana, the editor of the economic newspaper El Fi-
nanciero, says that “the cash economy [in Mexico] is still very
vast and it is also growing” due to 1) the strict policies of fiscal
authorities during the López Obrador administration (which
have enlarged the shadow economy), and 2) an expansion of
the informal economy absorbing the recently unemployed.
» Jorge Sánchez Tello, head of applied research at the Fundación
de Estudios Financieros (Fundef, Financial Studies Foundation),
said that the demand for cash increased due to people
“hoarding cash to make purchases, including people who
were let go during the pandemic. [… Also,] the informal
economy is going to grow, and there everything is [paid] in
cash to avoid being audited.”
» Lindsay Lehr, associate managing director and payments
practice leader at Americas Market Intelligence, said that “we
are seeing a quantitative reduction in the use of cash. This is
ibda INSIGHT 21

a trend that has been growing in the region, but we know that
in Latin America and the Caribbean, cash is truly rooted in
culture, in the mentality of people, and in the behavior of
businesses and consumers, so [reducing its use] has been a
really difficult battle.”
» Javier Tejado Dondé, an opinion columnist with El Universal,
says four factors are stimulating the demand for cash in Mex-
ico: 1) the federal government is paying some welfare benefi-
ciaries in cash, rather than through debit cards, 2) families and
small businessowners are hoarding cash given the economic
WILL COVID KILL CASH?
14. August 2020 / Written by omas Schiller, Ad-Hoc Economics
F rom clay tokens in Mesopotamia to silver coins in ancient
Greece, for centuries money has been something tangible.
As societies moved away from barter, they began using items that
were durable, portable and widely accepted as a form of money.
More recently, coins and banknotes have helped to build modern
economies.
In recent years technology has begun to change the way we
think about money. No longer is money just something physical.
Instead, in developed economies, the majority of people’s money
is kept in bank accounts rather than under the mattress. There
has also been a growth in electronic payment services such as
PayPal, Apple Pay and Venmo, meaning money can be transferred
quickly over the internet.
Spending and hoarding during COVID
The move away from cash as a medium of exchange has only
accelerated during the pandemic. Fears that banknotes will
spread the virus have seen many shops asking customers to use
contactless payments.
ibda INSIGHT 21
THE END OF CASH — MYTH OR REALITY
decline, 3) Mexican workers in the United States have in-
creased their US dollar remittancesto the country, 4) drug car-
tels and other criminal organizations are donating cash to
impoverished communities to gain their support.
The demand for cash as a store of value and reserve amid crises
can explain the vigorous growth in cash in circulation in Mexico.
This phenomenon has occurred in many countries worldwide
during the Covid-19 pandemic, such as Argentina, Australia, the
European Union, the United States, the United Kingdom, Japan,
Singapore, India, and Colombia.
While the World Health Organisation (WHO) has tried to allay
these fears, saying cash is no more likely to spread the disease
than other objects, the Bank for International Settlements (BIS)
has noted a marked increase in the use of contactless cards.
Since January 30th, the day when COVID-19 was labelled a ‘pub-
lic health emergency’, the use of contactless has made up an
even greater proportion of payments (contactless accounts for
over 70% of card transactions in some countries according to
the BIS). Maximum limits on contactless payments have also
been increased in many countries during the pandemic.
In addition, people have moved a greater proportion of their
spending online. This further increases the use of electronic
money. And as lockdowns were implemented, places where cash
was often used such as hairdressers, bars and cafes were shut-
tered.
Rather than spending cash, households are hoarding it. This is in
line with previous crises when households have sought the
security cash provides (what John Maynard Keynes called ‘pre-
cautionary demand’ for cash).
93
THE END OF CASH — MYTH OR REALITY

While, in the US, use of cash has declined, households have in-
creased their holdings of it: the total amount of currency in the
US has risen by 10% since the end of January (see chart).
Cash in circulation has increased in America during the pandemic
Currency Component of M1
A CBDC would also mean interest rates set by central banks could
be passed on to households. This would improve monetary policy
transmission. A CBDC could also provide an alternative to the
electronic payment systems offered by commercial banks as cash
becomes less common. Holders of the CBDC would therefore not
need to worry about banks failing, which would improve financial
resilience. A CBDC could also be offered free to households and
firms meaning they would avoid the transaction fees currently
charged by credit card firms.

A need for cash

Some, however, worry about the end of cash. Even in developed
economies many adults still rely on it. In 2017, 14 million adults
in America lacked access to a bank account (the “unbanked”),
with cash the most common way they paid their bills and received
their wages. There are also concerns about privacy if cash were
to disappear. A CBDC would need to address these worries and
ensure everyone had access.

Phasing out cash?
Some economists were arguing that cash should be phased out
even before the pandemic. Advocates of a cashless economy
point to the inefficiencies of cash: the cost of storing it, counting
it and transporting it. These costs can be difficult to quantify. The
British Retail Consortium, a UK trade body, has estimated that
the cost of handling cash amounts to 0.15% of the transaction
(versus 0.49% for credit card fees). Others put the figure much
higher. IHL, a consultancy, says the cost can be up to 15% for
businesses that are frequently having to count and transport cash.
However, while a substantial number of people still rely on cash,
governments have pledged to protect it. The UK has announced
it will look to protect access to cash for those who need it. Even
in Sweden, known for being a country relatively far along the tran-
sition to a cashless future, a law was passed last year forcing
banks to provide cash in rural areas. Protections such as these
mean that even though the future looks increasingly cashless,
cash may be around for some time to come.

In his book, The Curse of Cash, Kenneth Rogoff argues that the
existence of cash also aids tax evasion. In the informal economy,
workers are paid ‘cash in hand’ making it hard for authorities to
levy income taxes. He also points out that cash is a boon for or-
ganized crime: high denomination notes allow money to be laun-
dered without an electronic trace.

Removing cash would also increase the effectiveness of monetary

policy. People would be forced to hold their money electronically
meaning changes in interest rates could be passed on. Given
the option of holding cash (which pays an effective interest rate
of zero), taking interest rates negative can be tricky for central
banks. This problem has become more acute as COVID-19 has
required central banks to loosen policy.

A number of central banks are considering introducing their own

digital currencies. China and Sweden are both testing versions
of a central bank digital currency (CBDC). This would allow
households and businesses to hold electronic central bank
money in the same way commercial banks do now.

94 ibda INSIGHT 21
 THE END OF CASH — MYTH OR REALITY

CASH DEMAND DURING COVID-19

Article by: Rochelle Guttmann, Charissa Pavlik, Benjamin Ung and Gary Wang / Reserve Bank of Australia / Bulletin – March 2021

Trends in banknote demand
The COVID-19 pandemic significantly affected cash demand in
Australia. Demand for banknotes was extraordinarily high over
2020, despite a sharp decline in the use of cash in day-to-day
transactions. The pandemic has accelerated trends in banknote
demand that had already been occurring for many years. Namely,
the use of physical currency as a means of payment has contin-
ued to decline, while demand for cash as a store of wealth has
grown (Caddy, Delaney and Fisher 2020; Finlay, Staib and Wake-
field 2019). This article explores how banknote issuance evolved
during the pandemic so far, what factors drove the increase in
demand for cash and how this compares to historical and inter-
national experiences.
The sharp rise in the demand for currency began in mid March
2020, around the time that the federal and state governments
began imposing containment measures – such as travel restric-
tions and social distancing rules. The value of banknotes in cir-
culation grew by 17.1 per cent over the year to February 2021
reaching $97.3 billion (Graph 1). This compares with average an-
nual growth in banknotes outstanding of around 5 per cent over
the previous decade. As a result, the value of banknotes in circu-
lation, measured as a percentage of GDP, has reached a historic
high of 4.9 per cent.
The bulk of the increase in banknotes issued by the Reserve Bank
of Australia (RBA) occurred over the first 6 months of the pan-
demic ($13.1 billion in gross issuance from March to August). The
large spike in demand in mid March coincided with a period of
acute uncertainty during the early stage of the pandemic. Cash
demand grew at a more moderate pace in April as strict pan-
demic containment measures limited economic activity. Demand
for cash picked up again between May and August as govern-
ment restrictions were gradually eased, giving households more
opportunities to use cash. Since then, the value of banknotes in
circulation has continued to grow at around its average pace.
The strong growth in banknotes in circulation was driven by de-
mand for the higher denominations ($50 and $100 banknotes)
(Graph 2). Around 70 per cent of the volume of banknotes issued
since mid March 2020 were $50 banknotes and almost 20 per
cent were $100 banknotes. At the same time, returns of poor
quality or old series banknotes to the RBA were lower than usual
throughout 2020, but have picked up in early 2021.
Further, banks stopped returning banknotes that were surplus to
their requirements after the onset of the pandemic. This is likely
due to the sharp drop in economic activity leading to a slowing
in the movement of cash around the economy, as well as some
precautionary holdings by banks. The increase in high-denomi-
nation banknotes in circulation, coupled with reduced transac-
tional cash use, suggests an increased desire in the community
to hold banknotes as a precaution or store of wealth.

Graph 1 Graph 2
Banknotes iin
Banknotes n Circulation*
Circulation* Value
V off Banknotes
alue o Banknotes in
in Circulation
Circulation
Total
Total vvalue,
alue, sseasonally adjusted
easonally adjusted Year-ended
Y growth,
ear-ended g rowth, sseasonally adjusted
easonally adjusted

% Year-ended
Year-ended g
growth
rowth % % %

15
15 15
15
Higher d
Higher enominations
denominations
0 0 10
10 10
10

% Per
Per ccent
ent o
off G
GDP
DP %

4.4
4.4 4.4
4.4 0 0
Lower d
Lower enominations
denominations
3.8
3.8 3.8
3.8

3.2
3.2 3.2
3 .2 -10
-10 -10
-10
1991
1991 1996
1996 2001
2001 2006
2006 2011
2011 2016
2016 2021
2 021 2009
2009 2013
2013 2
2017
017 2021
2021
Source:
Source: RBA
RBA
* Includes b
Includes anks' V
banks' erified C
Verified ash H
Cash oldings h
Holdings eld a
held att d
depots
epots
Sources: ABS;
Sources: ABS; R BA
RBA

ibda INSIGHT 21 95
THE END OF CASH — MYTH OR REALITY

Drivers of cash demand during COVID-19

Transactional demand for cash

The use of cash for day-to-day payments has been in trend
decline. The share of total retail payments made in cash has
fallen from 69 per cent in 2007 to 27 per cent in 2019 (Caddy,
Delaney and Fisher 2020). For in-person transactions, the share
of payments made with cash was a little higher before the onset
of the pandemic, at 32 per cent in 2019 (Delaney, McClure and
Finlay 2020). COVID-19 has accelerated this trend; the decline in
transactional cash use was most apparent at the times when
lockdown restrictions were acute (and there was less opportunity
for in-person spending), but survey data suggest that the shift
away from day-to-day cash use may become permanent for
many consumers. There is a range of data sources that point to
weak demand for cash for transactional purposes, including:
subdued issuance of low-value banknotes ($5, $10 and $20);
declines in cash lodgements at cash depots; lower ATM with-
drawals; a sustained shift to online spending; and survey data
on banknote use during the pandemic.
mercial banks. The value of cash lodged at depots fell by around
a third between February and May, and remains well below pre-
pandemic levels.
Lower transactional demand for cash is also evident from the
sharp decline in the number and value of cash withdrawals, par-
ticularly at ATMs and in the early stages of the pandemic (Graph
4). The number of ATM withdrawals fell by around 50 per cent in
the first 2 months of the pandemic in Australia. By the end of the
year, withdrawals were still 20 per cent lower than before the
pandemic in February 2020. The average withdrawal size increased
at a slightly faster pace than its trend increase, which points to
some demand for cash as a store of wealth. Access to cash also
declined due to closures of ATMs and bank branches. This
decline in access was mostly temporary, with venues being in-
accessible due to lockdown restrictions and banks adjusting
their operations through reduced trading hours.

There has been little issuance of low-value banknotes during the

pandemic (Graph 3). These denominations are typically used for Graph 4
in-person transactions and for merchants to provide change, so
C ash Withdrawals
Cash Withdrawals
subdued demand for these banknotes reflects reduced use of Seasonally
S adjusted
easonally adjusted
cash for consumer spending. This is particularly the case for the
$5 and $10 denominations. There was no issuance of these de- m Volume
Volume Value
Value $b
$ b

nominations in the first half of 2020 and subdued issuance over

Cards*
Cards*
the remainder of the year. Over-the-counter
Over-the-counter
60
6 0 15
1 5

ATM
ATM
Graph 3
4
400 1
100
Net B
Net anknote IIssuance
Banknote ssuance
Cumulative
C umulative vvalue
alue

$b
$b $100
$100 $50
$50 $b
$b 2
200 5

3.0
3.0 5.0
5.0
2021
2021 2020
2020
0 0
0.0
0.0 0.0
0.0 N D J FM AM J J A S O N D J N D J FM
M AM J J A S O N D J
Average
Average 2019
2019 2020
2020 2021 2
2021 019
2019 2
2020
020 2021
2021
(2017–19)
(2017–19) * IIncludes
ncludes d ebit ccard
debit ard ccash-outs
ash-outs a nd ccredit
and redit ccard
ard ccash
ash a dvances
advances
$b
$b $20
$20 $5
$5 and
and $
$10
10 $b
$b Source: RBA
Source: RBA

0.0
0.0 0.0
0.0
The RBA Online Banknotes Survey – identified the broader shift
away from transactional cash use over 2020. (See ‘Box A: Con-
-0.2
-0.2 -0.1
-0.1 sumer Cash Use during COVID-19: Evidence from the Online
Banknotes Survey’ for more details on the survey of individuals'
-0.4
-0.4 -0.2
-0.2 attitudes towards cash.) Cash was used for 23 per cent of respon-
J FMAM J J A SOND J FMAM J J A SOND
dents' most recent in-person transactions. Although not directly
S
Source:
ource: R
RBA
BA
comparable, this is lower than the 32 per cent of in-person pay-
ments made in cash in 2019 from the Consumer Payment Survey
The value of cash that is moved from a retailer to a bank via a (CPS) (Delaney, McClure and Finlay 2020). Forty-four per cent of
commercial cash depot provides an indication of cash spending individuals reported using less cash since the start of the pan-
in the economy. These lodgements at cash depots fell sharply at demic, compared with only 12 per cent using more cash (Graph
the onset of the pandemic as businesses received fewer cash 6). Two-thirds of individuals said this change in payment behaviour
payments and took longer to deposit their cash floats into com was likely to continue even after the pandemic was over.

96 ibda INSIGHT 21
 THE END OF CASH — MYTH OR REALITY

Graph 6 An RBA survey of retail businesses during September 2020

identified a small but statistically significant decline in cash ac-
Effect
Effect o
off C
COVID-19
OVID-19 o
on
nCCash
ash U
Use
se ceptance (See ‘Box B: Merchant Acceptance of Cash and Cards’
Share of
Share of rrespondents
espondents for more details on the survey methodology and results). Although
% the vast majority of retail businesses continued to accept cash
Cash u
Cash use
se ssince
ince C
COVID-19
OVID-19 Vendor d
Vendor did
id n
not
ot a
accept ash %
ccept ccash
during the pandemic, the acceptance rate decreased by 3.6 per-
centage points to 95.8 per cent, compared with near-universal
45
45 45 cash acceptance in February 2020. As such, the merchant and
consumer surveys both highlight a decline in cash acceptance.
Note that a small decline in cash acceptance by a few merchants
30 30 could potentially lead to a larger decline in the ability for people
to use cash.

15 15
15

0 0
Less
Less Unchanged
Unchanged More
More 2019
2019 2020
2020
Often
Often Often
Often
Source:
Source: RBA
RBA

ibda INSIGHT 21 97
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