The finance sector has undergone a steady transition from the traditional to the digital front. Globally, despite advances in alternative payments such as cards and electronic payments, cash is extremely vital, still growing, and will be playing the dominant role as the central means of payment for at least one if not two decades in the majority of countries.
However, the cash supply-chain is changing. Financial institutions are shrinking their branch networks, and are increasingly automating their processes or outsourcing their ATM fleet. These changes are driven by two key factors: Cost pressures and the need for increased automation, as each distribution step requires costly security measures and careful tracking. The need for balance in the demand and supply of cash is imperative. Adding to this, surprisingly cash circulation is acutely complex and expensive.
Dr. Joachim P. Walser—a veteran in the development and successful introduction of optimization methods in supply chain projects—came up with a ‘silver bullet’ in this vast untapped arena to enhance the journey of cash from the central banks to the people and back, known in the financial space as cash cycle management. He co-founded planfocus to improve the supply chain between banks and their associates, such as cash-in-transit companies, to supply cash among the cash points across the network. The company equips clients with next-generation cash-cycle optimization to make cash distribution as efficient as possible.
Since its inception in 2004, planfocus has been delivering unique cash cycle solutions to over 200 clients globally. planfocus provides its solution CCO in the form of innovative software onsite, or with its SaaS model.
With in-depth expertise in the realm of supply chain management and modern cash handling systems, the dynamic team at planfocus lays down the groundwork for a complete overhaul of the existing approaches in the market and travels an extra mile to enhance the performance and process coverage. Cash Cycle Optimizer, a premium solution suite from planfocus responsibly manages the entire supply chain related to the availability of cash in the cash points by controlling all of the cash movements. Shipments of cash are conducted by armoured trucks allotted by cash-in-transit companies, and planfocus solutions are already driving the delivery of over 250 billion Euros value of cash annually. Cash Cycle Optimizer receives daily inventory reports about the local cash holdings and accordingly predicts how much cash will go out or in at the cash points to ensure with just-in-time deliveries that those demands can be met.
“We leverage high-end automation and artificial intelligence in Cash Cycle Optimizer to ensure availability of cash in ATMs at all times,” says Walser, CEO, planfocus. Additionally, planfocus also looks into cash moving from retail to bank cash points and recycles them if possible. The key to process efficiency is to shorten the cash cycle wherever possible to avoid cross-shipping of cash up and down the chain.
planfocus provides the most advanced solutions to keep the network costs of cash competitive to cards and other payments, so consumers can keep the freedom of choice when it comes to their payments
The company has architected a complete cycle involving the journey of cash from the respective the central bank to cash points such as ATMs and branches and back. The key to process efficiency is to shorten the cash cycle wherever possible to avoid cross-shipping of cash up and down the chain. This requires exact forecasting and planning algorithms to prevent outages and have the right cash product at the right place. It brings a noticeable reduction of costs related to cash-in-transit (CIT) and reduced cash inventory holdings. Following this, automation is leveraged in the bank branches where cash, coins, and non-cash items are ordered. Shipments of these items are monitored with rigid tracking and tracing, while the branches provide incessant support during the cash recycling process. The cash center processes are supported by the CCO solution to consolidate the ordering process generated from banks, controlling the cash center inventory planning, along with automated booking and reconciliation of all transferred shipments. Besides, planfocus is one of the pioneering companies worldwide to provide enhanced communication between commercial banks the central bank by leveraging standardized XML communication from GS1 in the process of ordering, provisioning and status changes. Lastly, the CIT process involves automation of tour planning and its optimization while addressing transport capacity limitations as well as tracking and tracing the shipment. This improves the service-level agreement (SLA) while simultaneously cutting down on risks related to stock-outs and reduction of costs for CIT and cash returns.
With its best-in-class and unique offerings in the area of cash cycle management, delivered at a cost-effective pricing structure, planfocus today operates with an 80 percent share in the German market. In addition, planfocus also enjoys a strong business growth rate.
“Our uniqueness lies in the fact that we ensure the availability of the right amount of cash across cash points at the right time, and in doing so we are providing value to our customers that gives them a return-of-investment often as measured in months,” adds Walser.
According to the CEO, “planfocus is determined to reduce the unnecessary costs related to the cash supply chain via advanced use of automation,” says Walser. He cites a case study, where planfocus assisted ING Bank Belgium, with its mission to create an entirely new cash platform that covers all cash and valuables processes, from planning for cash recycling at the branches to orders from retail customers to tracking and tracing the money being transported from the bank to the specified cash points. Furthermore, the company also assisted Deutsche Bank to save almost 1 million Euros per year in the process of cash delivery in all of their ATMs over a previously existing optimization solution. Deutsche Bank is the core bank of Deutsche Bank Group, which also includes Deutsche Postbank, the largest German private bank, which also converts and edits cash processes into a coherent CCO platform. planfocus strives to make cash handling easier and simultaneously cost-effective for their clients.
planfocus is now providing their services worldwide to introduce their Cash Cycle Optimizer suite globally, through distribution partners: “Especially our strategic global partnership with Diebold Nixdorf, the global market leader for ATMs and solutions and services for retail banking, has been very successful. Since 2014, Diebold Nixdorf provides our solutions to customers globally, and supports them with expertise available close to them–experts who can answer complex questions, run project implementations professionally and look after them onsite over the long term,” concludes Walser.