This is the second part of an interview with BörsenRadio Network AG conducted on July 20th, 2010. Alfonso Ciotola is speaking about the company’s mill in Landqart, Switzerland which produces security and specialty papers such as banknotes. He is explaining what makes the “banknote of the future” so special and how this is supposed to deter counterfeiting.

As manager you have to travel a lot. What does your week look like?

I spend about 50% of my time in our Landqart mill in Switzerland, where we produce banknote paper, about 30% here in Dresden, and the rest elsewhere. We have built very strong management here in Dresden, which is able to represent me well.

Let’s talk about your other mill. I’m holding the “banknote of the future” in my hands, that’s exciting. It doesn’t have value yet but it’s a glimpse into the future. It has transparent holes, what are they for?

Those aren’t holes, but transparent windows. Central banks have been wishing for banknotes with transparent windows for a while, because they are really hard to copy. Together with the Swiss National Bank, for which we are the sole provider, we developed a technology. This technology allows us to create a material which contains two layers of banknote paper and a polymer in the middle, and to embed those transparent windows.

Is this still a dream of the future or will it be our real money soon? How often do central banks actually renew banknotes?

These aren’t dreams of the future. We’ve already installed the machine in Switzerland, and we have concrete projects not only with the SNB but with other central banks which will allow us to introduce this product to the market probably 2011/2012. So you’ll have this product in your pockets within the next two years. Central banks nowadays tend to take banknotes out of circulation earlier and develop new series with new security features, in order to prevent counterfeiting.

Is this new technique forgery-proof, or is it simply too expensive for counterfeiters?

It certainly is a very complicated process, which you need a complicated machine for. But even more complicated is the technology to produce the windows. You have to punch holes, as you called them, into two 35g thin paper layers and make sure that they are overlapping 100%.

How big is the business volume of this mill?

In Landqart we have a turnover of 85 Million Swiss Franc. With a new investment that we are going to do this year, we will bring the production capacity of banknote paper to a much faster machine, so we have to position the company on at least the same EBITDA level as Dresden.

Would you make a prognosis for the capital market? Do you know already from the forecast how big the turnover will be 2010?

I think it depends a lot on the development of the commodity prices. We have a very good workload here in Dresden and in Landqart as well, and I think we can expect at least the same as last year.

SOURCE: BörsenRadio Network AG

In an effort to keep up to date with anti-counterfeiting technology and increasingly high-tech security features on banknotes around the world, the Bankgko Sentral ng Pilipinas (BSP) in the Phillipines announced this week that it will launch a new series of banknotes in December 2010.

“We want to take advantage of these technologies,” BSP Monetary Stability sector Deputy Governor Diwa Guinigundo told the Phil Star.

As a result, the new generation notes (the Piso) – issued in the P20, P50, P100, P200, P500, and P1,000 denominations – will contain heightened security features that aim not only to deter counterfeiting but also help make it easier for the public to detect fraudulent bills among their currency.

“As a matter of practice, central bans regularly change the designs of the money – whether coins or banknotes – to guard against counterfeiters,” another BSP source said. “By making it very difficult and costly for counterfeiters to produce exact copies of our money, we protect the integrity of our currency against criminals.”

Currently, the Piso banknotes contain standard security features such as security threads, security fibres, watermarks, invisible fluorescent inks, optically variable ink, microprint, moiré pattern and an iridescent band.
Other banknotes around the world have been outfitted with some of the most modern security devices known in the banknote industry recently. The new American $100 bill, for example, contains 3D holographs. Other up-and-coming anti-counterfeit devices include quantum dots (nanoscale dots that emit intense light), pixelating watermarks (photos that appear to be 3D because of the way the shades are printed), the reproduction of intricate patterns akin to butterfly scales, and see-through windows rooted between the layers of a polymer banknote.

Though the BSP hasn’t said which new features will be embedded in the notes, the central bank has said they will undertake a nationwide information campaign to educate Filipinos on the new features and help them learn how to tell genuine banknotes from counterfeits.

In terms of design, the new banknotes will pay tribute to Filipinos who played significant roles at various moments of the nation’s history and will also feature world heritage sites and iconic natural wonders of the Philippines.

The BSP also has plans to issue a new series of coins which aren’t expected to be circulated until 2012.

The current Piso series, which includes both coins and banknotes, hasn’t received a re-vamp in nearly 30 years.

SOURCES:
PhilStar.com: “BSP To Redesign Banknotes and Coins”
PhilStar.com: “BSP to Release 1st Batch of New Banknotes In December”
Philippine Coins and Banknotes: “FAQs: BSP Banknote and Coin Resdesign”
Bankgko Sentral ng Pilipinas: “BSP Notes & Coins”

India will begin printing Rs500 & Rs1,000 banknotes on securitized "blue paper" in an effort to deter counterfeiting in the country.

After a significant “large-scale circulation of fake notes” throughout India over the past year, the Indian government has decided to begin printing Rs500 and Rs1,000 on special blue security paper to curtail counterfeiting in the region.

Blue paper is made by combining cotton and linen fibre with a special dye that only glows under ultraviolet rays. This dye also ensures the paper – which eventually in this case will be made into banknotes – also radiates a unique blue hue that makes it virtually impossible for colour photocopiers to reproduce.

The Indian government says the switch will not only deter counterfeiters, but will also pay off in the long run.
“The blue security paper has higher durability compared to normal currency notes. While it is costlier to produce, it is cheaper than having to deal with fake currency,” said a senior official.

Though it is an important component in the world of banknote security, blue paper is not a new idea. The first recorded mention of blue paper comes from Italy in the 14th century, where it was first used by artists as mounts for drawings. Over the centuries, blue paper sometimes became an alternative to white paper and was used in Europe during the 18th and 19th centuries for books.

Around the same time, manufacturers of blue paper began dyeing the paper pulp instead of using disintegrated rags which resulted in the paper achieving more intense colours.

Today, blue paper has moved from the artistic realm to the security realm thanks to this dyeing process. Because the dye is applied to the entirety of the banknote and not just to select locations on the note, the paper itself becomes a security feature and is, as researchers from the Fraunhofer Institute for Applied Polymer Research have said about notes using fluorescent dyes, “itself a component of the identification label.”

Colour is an important security feature as well. Embedding additional colour designs to the blue paper is beneficial to paper producers who specialize in anti-counterfeit devices.

Printing of the Rs500 and Rs1,000 banknotes is scheduled to get underway by August and the new notes are expected to enter into circulation by December 2010.

SOURCES:
BNet: “Blue Paper To Be used For Rs500-1,000 Notes”
The American Institute for Conservation: “Historical Manufacture and Use of Blue Paper”
Nanowerk: “Brilliant Counterfeit Protection”
Polymernotes.org: “A Paradigm Shift In Bank Note Security; Security Features in Polymer Bank Notes”

In an attempt to revive the life of the £5 banknote, British banks will soon make the notes available in automated teller machines (ATMs).

The Bank of England says the £5 was beginning to fall out of circulation because many people now consider the denomination to be “small change.” As a result, a bank source told UK’s The Daily Mail this week, the five pound notes end up “being stuffed into people’s back pockets, rather than returned to banks in the form of deposits” and therefore not a likely candidate for ATMs.

Last year, in conjunction with HSBC, the Bank of England launched a pilot project asking street lenders to stock more of the notes and are beefing up the project this summer with their focus on ATMs.

According to the Daily Mail, “In the early 1990s, just 25 per cent of cash was withdrawn using hole-in-the-wall machines, but their use has exploded and ATMs now dispense around 70 per cent of all cash in circulation. But as banks prefer to dispense larger denomination notes from their cashpoints, the fiver has suffered in comparison.”

This isn’t the first time England has sought more lower denomination bills to be introduced into circulation. As we wrote back in November, British business leaders urged the Bank of England to increase the number of £10 claiming that “those who frequently use cash dispensers who don’t want ‘to carry higher-value denominations, especially £20 notes, around in their purses and wallets.’”

These same business leaders said that “despite credit and debit cards, small-ticket items are [still their] lifeblood,” highlighting a continual need for banknotes not only in England, but the world over.

SOURCES:
The Daily Mail: “£5 Notes To Be Available From Cash Machines”
The Daily Mail: “Give Us More Tenners, The Bank of England is Urged”
Global Paper Security: “British Business Leaders Demand More Ten Pound Banknotes”

A month before the World Cup of soccer is set to take place in South Africa, the country’s central bank is recalling its old series of 200-rand banknotes citing a huge prevalence of counterfeits as the primary reason for its withdrawal.

“This year we have seen an increased number of counterfeit notes,” said Aboobaker Ismail, head of currency and protection of the Pretoria-based central bank. “We are extremely concerned about it but we are doing something.”

The bills being withdrawn are part of an old series printed before 2005, which is when a new series was introduced with added security features. The only distinguishing marks, however, are minor design differences.

Consumers have until May 31 to exchange the notes at commercial banks, though they can be exchanged at the Reserve Bank after that date.

With nearly 400,000 expected to visit South Africa in June for the world’s largest sporting event, the central bank is undergoing an extensive campaign to teach people about the difference between real and fake 200-rand notes.
Newspaper commercials, posters and brochures have all been printed as part
of the campaign.

Samantha Henkeman, spokeswoman for the South African Reserve Bank, says personal precaution will be a large part of the education campaign as well.

“The South African public is encouraged to re-familiarise themselves with the security features on South African banknotes and to examine them on receipt,” she says. “Do not hesitate or feel embarrassed about holding a banknote up to the light. Look, feel and tilt the banknotes to ascertain the security features.”

Though Ismali says they hope to not only withdraw the old series before June as well as “weed out” all counterfeits, some retailers are taking the extra precaution of not accepting any 200-rand note altogether.

The South African Gold Coin Exchange, which is licensed to sell the bullion discs stamped with the official 2010 World Cup logo, has also barred the use of all 200-rand notes at its stores countrywide from the end of this week.

South Africa will introduce new notes across all currency denominations with upgraded security and design features “in late 2012,” said Ismail. The denomination mix of 10-, 20-, 50-, 100- and 200-rand notes won’t change, he added.

SOURCES:
Business Week: “South Africa Fights Rand Counterfeits A Month Before World Cup”
Independent Online: “Old R200 Banknote Recalled”

The RCMP Winnipeg Commercial Crime Section said last week they have seen a dramatic increase in the number of counterfeit US $100 banknotes being passed in Edmonton and surrounding areas.

 The fake notes are very good quality, they reported, and contain security features that closely mimic those found in genuine notes.

 Though the United States recently announced the launch of a new $100 bill with added high-tech security features, the counterfeits Canadians are finding are not modeled after the new design as these new bills won’t be introduced to the public until February 10, 2011.

 Currently, the US $100 banknote includes security features such as a watermark of Benjamin Franklin on the right side of the bill, optically variable ink (OVI) that changed from green to black when viewed at different angles, a higher quality and enlarged portrait of Franklin, fine-line printing around Franklin’s portrait and Independence Hall, interwoven red and blue silk fibers, microprinting, and a plastic security thread that glows red under a black light.

 The new US $100 bill will retain some of those features but will also include new highly secure 3-D features such as ribbon crossing the center of the bill that depicts bells transforming to numeral 100s and a colour-changing Liberty Bell inside a inkwell, which are all visible as the bill is tilted.

 Other new features can be found in the bill’s denomination both on the front and back. The “100” on the front shifts from copper to green when tilting the note and a large gold numeral 100 on the back helps people with visual impairments recognize the bill more easily.

 Canadian bills contain several different security features. The Canadian $100 banknote, for example, is equipped with a metallic holographic stripe, colour-changing dashes found on the bill’s security thread, and raised ink (intaglio printing).

 The RCMP say Canadians may not be familiar with the US note’s security features, and are encouraging employees working with cash to become more familiar with the US currency in order to prevent the spread of counterfeit bills.

 SOURCES:


My Steinbach: “Public Warned About Counterfeit US $100 Banknotes”
“United States One Hundred-Dollar Bill”
Global Paper Security: “A Closer Look At The New US $100 Bill’s Security Features”
Bank of Canada: “2001-2004 Series, Canadian Journey”

The new Ugandan banknotes enter circulation on May 17.

Common security features can be found on the new series such as a watermark, a colour change image and a raised effect on the surface. The notes also feature a windowed thread that changes from red to green when the note is tilted and a hidden shiny stripe pattern.

Uganda is also the first African country to introduce a high-tech security feature called SPARK, an optical security feature for banknotes.

Banknote reform in Uganda has been the cause of some controversy over the past few decades. BOU chief Emmanuel Tumusiime Mutebile said new banknotes were typically issued for political reasons, usually after a change in government.

“This is the first time that the BOU has introduced new notes on its own,” he explained.

The revamp was done this time around in order to comply with international practices and to introduce more security features in a continuous attempt to thwart counterfeiting.

The bank hired professional artists for the redesign, who drew up banknotes depicting pots and ornaments common in Ugandan homes.

While most of the notes are in the familiar denominations of sh50,000, sh20,000, sh10,000, sh5,000 and sh1,000, the bank also introduced a lower sh2,000 note to ease transactions “among ordinary people” according the Ugandan Finance Minister Syda Bbumba.

The new notes will enter into circulation on May 17 alongside the old series, which will be phased out over a period of a year-and-a-half.

SOURCE:
New Vision: “Central Bank Issues New Currency Notes”

The bailiwick of Jersey is part of the Channel Islands, located between England and France

Complete with images that chronicle key moments in the island’s history and phrases written in the native Jèrriais – a distinctive brand of French – the banknotes are the first new series Jersey has introduced in over twenty years.

Like many new banknotes, the Jersey series also comes equipped with new security features to deter counterfeiting. A hologram on the top left corner of the notes is one of the new features added to the series as well as a see through map of the state. Familiar features such as a watermark and a silver security thread that appeared on old banknotes return to this series as well.

This video gives an in-depth look at the new security features as well as the rich history embedded in each note:

The new series only covers the £1 to £50 bills, though a new £100 note could be considered next year. Over the next eight weeks, more than £20 million of the new banknotes will be put into circulation.

The existing Jersey banknotes are still legal tender and will remain in circulation until each note reaches the end of its useful life.

SOURCES:
Banknote News: “Jersey Issues New Note Family”
YouTube: “New Jersey Currency”

The new high-tech $100 US bill will be available in February 2011. Source: Getty Images

The new US $100 banknote is being called “the next generation one hundred” by the US Treasury Department.

Along with a redesign of the bill’s graphic layout and the addition of some colour, several new security features have been added to the bill while some old ones maintain their presence.

The newest, and arguably the most technologically advanced, security feature is a 3-D ribbon crossing the center of the bill. The images on the ribbon – bells that transform to numeral 100s that turn back into images of bells – move as the bill is tilted.

Next to the ribbon is another 3-D device that embeds a colour-changing Liberty Bell inside an inkwell when the bill is tilted at various angles.

Other new features can be found in the bill’s denomination both on the front and back. The “100” on the front shifts from copper to green when tilting the note and a large gold numeral 100 on the back helps people with visual impairments recognize the bill more easily.

This video, put together by the U.S. Treasury, details some of the bill’s high-tech features:

The new bill also contains multiple traditional security features. Raised printing, microprinting, a security thread, and a Benjamin Franklin watermark are all part of the banknote’s anti-counterfeiting measures.

The new notes will be available on February 10, 2011 and old bills will continue to be accepted until they wear out.

SOURCES:
The Wall Street Journal: “U.S. Unveils New $100 Bill”
The Week: “New $100 Bill: Too Sci-Fi?”
You Tube: “$100 Note Unveiling Video”

The recent announcement by Vancouver-based Fortress Paper to increase the printing capacity at their European mills (read “Fortress Paper announces approval of initial financing facility for PM1 rebuild”) reiterates the reality that even in a digital age the need for banknotes continues to increase worldwide.

Though credit cards, online banking and debit cards seem to be maintaining an edge over cold hard cash, many agree this is a common misconception.

A trial-run move to debit only in Uzbekistan has demonstrated major problems in a digital-only scenario (read “Uzbekistan debit woes highlight continual need for banknotes”) and late last year British business leaders issued a public demand for more banknotes to be printed (read “British business leaders demand more ten dollar banknotes”).

Chad Wasilenkoff, President and CEO of Fortress Paper, agrees that the global demand for banknotes is always increasing.

“Banknotes continue, in all countries that we know of, to require more banknotes on an annual basis,” he says in this video.

The upgrades to their PM1 printing machine will allow Fortress Paper to print more banknotes at their European facilities. The upgraded machine will increase production capacity from the current 2,500 tonnes per year to approximately 10,000 tonnes per year.

In addition to printing banknotes, Fortress Paper also prints various other security and specialty papers for items such as visas and passports.

SOURCES:
YouTube: “Fortress Paper CEO Chad Wasilenkoff Speaks about the Solid Demand for Banknotes”
“Fortress Paper announces approval of initial financing facility for PM1 rebuild”