Written as an exclusive for International Security Journal and originally published in October 2022

It is evident that cash has longevity, not just for the million plus individuals who are unbanked, but for the wider community where cash payments are still commonplace.

Across the UK retailers we know, cash is used for around 20% of all transactions, so one in every five transactions is made with cash. Cash use is heavily impacted by demographics, including a person’s age, confidence with technology and their income. Some sectors are more cash heavy than others, with petrol stations and leisure activities seeing continued high cash volumes and some hotels and coffee shops seeing renewed consumer demand to accept cash post-COVID-19.

UK residents are facing unprecedented pressures on their day-to-day lives, be it from higher energy prices, surging inflation or the impacts of industrial action. Recent media articles have indicated an increase in cash usage has been seen. Multiple G4S retail customers have reinstated their cash collection services and some have needed to increase their collection service frequency.

Against a backdrop of rising inflation and a predicted economic downturn, the pressure on household incomes is exacerbated. Historically, when household budgets have been under pressure, people tend to carefully control and curtail their spending – and one mechanism for doing this is to  spend only the cash withdrawn from an ATM.

While the use of credit and debit cards makes for easy spending, this can cause higher than budgeted costs. The visual recognition of cash handling is greater, so we are more cognisant of our own behaviour when paying with cash.      

Cash flow is key to the success of any business, so this drives an essential need for retailers of all sizes to continually bank all cash takings. Today, cash is primarily banked via either a regular, weekly cash-in-transit collection service or more frequent smaller deposits being made to a nearby bank branch.

In the UK, cash-in-transit services have plateaued; the market is highly competitive and price sensitive. G4S is focused on innovation to deliver the most efficient cash management process possible for its customers. We use our technology to monitor our customers’ cash holding data so that they have the right collection frequency for the volume of cash being collected.

The security of the cash held on-site between collections is a key consideration, along with the need for good cash flow and the cost of the collection service itself.    

With the bank branch network under constant review, the ‘walk to bank’ customer will need to explore alternatives to best ensure their cash flow. While a company may have a corporate vision of a ‘cashless society’, and therefore they seek to phase out accepting cash, what the public actually wants can be quite different.

Cash continues to be used regularly and, here, the consumer is king. Shoppers will ultimately decide the need for a retailer to accept cash. In deciding to no longer accept cash, a retailer may ultimately lose 20% of its existing customers who wanted to pay by cash, which could be very risky in the current climate. During the height of the pandemic we had seen retailers not accept cash and we now once again see these same retailers accepting cash, thus needing to reinstate cash collection services to bank this physical form of currency. Customer payment choice is paramount and cash remains highly relevant to any retail businesses continued trading.

Cash360

G4S is investing in innovation, bringing customers intelligent cash management solutions in the UK marketplace. We have established Low Value Collection services, lowering our own cost base to create a competitively priced, discreet collection service focused on the SME customer need. We have also created CASH360 as an end-to-end cash management solution for retailers of all sizes.

CASH360 uses a software platform to monitor the cash accepted and secured within a Smartsafe installed at the retailer’s premises. This data is passed to the respective bank to credit the customer’s bank account, providing a material cash flow benefit, removing the legacy relationship between cash acceptance and it needing to be taken to the bank to credit the bank account.

With CASH360, the cash is credited from live cash holding data, with the cash collection automated by the same software platform monitoring the amount of cash secured on-site. The cash flow benefit is optimised with the cash collection frequency and security of cash holding. Cash flow empowers the retailer to make buying decisions, lower lending and pay suppliers quickly.

G4S works with multiple cash handling technologies to install a suitable Smartsafe, into which all cash is validated and secured between collections. G4S takes care of the security by first ensuring the safe is installed to a set of predetermined security protocols; we then indemnify the cash content in the event of an attack.

G4S has established this solution across multiple UK customers in conjunction with a selection of high street bank brands and we expect to see this mature with growing consumer demand for greater efficiency in cash management.

One established UK retailer has rolled out CASH360 to around 200 UK stores, citing the significant business benefits of cash flow from daily bank credit with a more efficient cash process and reduced labour. All their stores have at least one cash collection per week, from a securely installed Smartsafe scaled to meet the cash takings of the store.

A need for innovation

The downturn in cash volume at a macro level, mainly driven by the COVID-19 pandemic, coupled with rising labour costs, makes the need for efficient cash handling more acute. Current cash volumes, a potential rise in this volume and no likelihood of a ‘cashless society’ will demand greater focus upon innovation in the cash management area.

Security of cash on the retailer premises is a key need and another factor influencing the current frequency of banking cash. With the G4S CASH360 solution, the company installs a Smartsafe, takes liability for the cash once it is secured and assures that it is collected before the safe limit is reached.   

CASH360 gives the customer the benefit of a more efficient end-to-end cash process, removing labour incurred in counting cash, reducing the time and risk associated with walking cash to the bank, delivering the optimum cash flow, automating the cash collection frequency and providing online data for all deposits and collections to enable ease of cash reconciliation.

With a Helpdesk and field maintenance service, it really is a complete solution for the customer.