The 2022 Coin Conference, which took place in Amsterdam from 17-19 October, attracted 160 delegates from 45 countries and 92 organisations, including central banks, mints, academia, and industry suppliers.
The Coin Conference is the only event to focus on circulating coins as part of cash strategies and, with three years having elapsed since the last event (in Rome in 2019), there was plenty to talk about.
There were two pre-conference workshops – the first from the IMDA Customer Task Force (CTF) for central banks on ‘Coins for Cash: What the Public Wants’. It followed the pattern of the CTF workshops at previous Coin Conferences in bringing together national authorities to discuss the key issues and latest priorities for circulating coins. This time the focus was on the role of coins in the cash cycle in times of crisis, and the needs, and wants, of the public.
The other, entitled ‘Coins and the Environment’, will be covered more extensively in next month’s issue of Coin & Mint News™.
The workshops were followed by an opening cocktail reception hosted by the Royal Dutch Mint at its new purpose-built facility in Utrecht, the so-called Dutch Vault, which opened during the pandemic and is the only energy-neutral mint in Europe.
Setting the Scene
The conference itself opened the following day with a session named ‘Setting the Scene’, led off by a presentation from Astrid Mitchell, Conference Director and editor of sister publication Currency News™, on changes since the last conference in 2019. Delegates were reassured by statistics showing that cash in circulation (coins as well as banknotes) continues to increase year on year in the vast majority of countries, and that a fall in production volumes for coins over the past eight years is almost entirely accounted for by China and India. Take those out of the equation and production volumes have held up well – not exactly growing, but not shrinking either.
Moreover, out of 180 currencies, 35% have seen one or more changes to their coins since 2016 – not bad for a sector where, apparently, ‘not much happens’.
Vincent van Hecke of the Royal Dutch Mint shared his views on where stakeholders in the coin ecosystem are failing in terms of sustainability. This ranged from lack of awareness of the secondary effects of the footprint of coins in terms of CIT policy and recycling, and taxes and levies leading to the relocation of suppliers and the import of raw materials and finished products, to inflexible tender prices focused only on the lowest price, and standards such as ISO 14001 which, whilst a start, do not look at the entire supply chain.
Some of these could be mitigated, he said, by central banks reviewing low denominations and the note/coin boundary, more attention to logistics and packaging, tenders that give more weight to eco-friendly processes, and policies to establish efficient logistics networks for CIT and end of life coins.
Sustainability was also the theme of the presentation from Honey Mamabolo of the South African Mint and Michael Groves of the Royal Canadian Mint, speaking on behalf of the International Mint Directors Association (the successor of the MDC) about its Sustainability Charter, one of the key pillars of the newly- formed association.
The keynote presentation was given by Brian Weaver of the Federal Reserve and Kristie McNally of the US Mint, who lead delegates through the just-published report ‘US Coin Circulation: the Path Forward’.
Cash and Coin Demand
The second session – on ‘Cash and Coin Demand’ – heard first from Prof Franz Seitz of Germany’s Weiden Technical University of Applied Sciences. He gave a presentation entitled ‘Cash and Coin Usage Before, During and After the Pandemic’ based on his recent research, which covered the period of 2020-2022 and a variety of advanced economies. The results were mostly similar amongst these countries – showing that cash in circulation increased, particularly the higher denominations of both notes and coins, but that the use of cash at the point of sale declined.
With the pandemic now (hopefully) in the rear-view mirror, so to speak, of most interest is how it has changed people’s payment behaviour. 45% of those surveyed as part of his study said they would certainly pay less with cash in future, 41% said they would probably pay less, and only 13% said they would revert to paying as they did before the pandemic.
Next was Alejandro Alegre of the Bank of Mexico, who discussed a planned restructuring and optimisation of the coin series, including a switch to plated coins to reduce costs, proposals for which will be presented to the Mexican Congress in the first half of 2023.
He also discussed the evolution of the 20 peso coin, a smaller, lighter and more cost-effective version than its predecessor which was introduced in 2020 and, to date, has been used to commemorate Mexican heroes and landmark historical events. Seven designs are currently in circulation. Focus groups have indicated that the public like the coin (so much that many are hoarding them), and 67% would use them in daily transactions if they have a generic design. A proposal to that effect, that would also involve the phasing out of the 20 peso banknote (which was not included in the latest banknote series), will also be presented to the Mexican Congress next year.
Alejandro was followed by Marc Schwarz of the Monnaie de Paris, who presented the results for the first time of a qualitative and quantitative study commissioned by the Mint earlier this year into trends in payments behaviour and the attitudes of French people to cash.
The studies found that more than eight out of ten people remain firmly attached to cash and that over 90% recognised the value of its functional qualities either wholly or to a certain extent; namely cost, convenience, privacy, security, accessibility to everyone, budgeting and teaching children the value of money. The symbolic value of cash is also important to more than 70%. Cash received the highest scoring of trust (95%) among all payment methods, and 81% would be worried if cash disappeared. Interestingly, and unusually among eurozone countries, 53% of people are not in favour of removing the 1 and 2 cent coins.
The next speaker, Igo Boerrigter of De Nederlandsche Bank, brought delegates up to date with the Bank’s role in coins in the Netherlands in the context of declining cash usage.
DNB wants to ensure that cash continues to function properly as a means of payment, and to this end led the Cash Covenant initiative, which was signed earlier this year by 23 organisations involved in the Dutch payment system as a counter to the steady increase in electronic payments. The agreements regarding the availability of coin and note deposit machines, uptime of ATM infrastructure, cash service points, deposit machines, and support for cash-dependent groups in society will be in place for a period of five years.
The session concluded with Martina Horakova of the newly formed International Mint Industry Association (IMIA) which has been set up to proactively advocate for sustained and convenient use, access, and acceptance of cash and coins, on behalf of its mint members as well as the industry’s suppliers and stakeholders.
Martina provided examples of several countries where the central bank and/ or regulators are actively engaged in supporting access to and acceptance of cash, including Poland, Austria, and New Zealand.
The IMIA will be focusing in particular on trust, legal tender status, limits on cash payments, access, marginalisation of cash users and communications by national authorities on cash (presumably with the misinformation surrounding the safety of cash during the pandemic in mind).
Coin Circulation Initiatives
The third session was on the topic of Coin Circulation Initiatives and began with Beatriz Guía of the Bank of Spain describing the country’s coin cycle and distribution arrangements, which are undertaken via its 15 branches and three CIT companies. These cover not just mainland Spain but also the Balearic and Canary Islands, Ceuta and Melilla.
Coin withdrawals, stocks and production have declined by about a third since 2016, dropping more sharply during the pandemic, but have now recovered to pre-pandemic levels.
The Bank has recently implemented new software to register and manage coin requests from the distribution network and a new programme to control cash stocks. It is also in the process of installing coin collection machines at its premises.
Krzysztof Kowalczyk of Narodowy Bank Polski (NBP) gave a description of the coin deposit programme being rolled out at NBP branches to enable the public to deposit coins and receive the equivalent value commission-free in notes or credited to their account via an app.
As well as being a huge success in retrieving coins from circulation and reducing production and issue costs, it also earned the NBP an award in the IACA Excellence in Currency Awards for Coin, which were presented at the end of Day One.
Next, Mary Anne Lim of Bangko Sentral ng Pilipinas (BSP) spoke on the Bank's latest initiative, the Coin Deposit Machine (CoDM) project, which is a partnership with the three major retailers in the Philippines to install coin deposit machines in sites across the Greater Manila Area and nearby provinces. The Coin Deposit Machine Project will run for two years and, if successful, will be rolled out across the country. The BSP estimates that it will save 20.3 billion pisos in minting costs over this period.
Mary Anne also talked about the Cash Service Alliance (CSA), which was set up in the early days of the pandemic to enable banks to see each other’s cash positions, with those having surpluses able to trade these with those that had shortages. The CSA covers coins as well, and as of September 2022, 26 banks were participating, servicing over 26% of coin requirements.
It has also set up a Currency Exchange Drive, involving the setting up of booths in high-foot traffic areas in the regions to facilitate the exchange of unfit banknotes and coins.
The session concluded with a presentation from Scott Hutchings of Global Coin solutions, on how the various schemes run by airlines and airports to repatriate foreign coins are helping charities raise much-needed funds and improve the circulation of coins around the world.
Coin Management and Optimisation
The final session of Day One focused on Coin Management and Optimisation.
Simon Lake of The Royal Mint spoke on the coin/note boundary, and in particular how converting low value banknote to coins protects the environment, reduces sorting and processing, provides a more balanced currency structure, and delivers true seigniorage. He detailed the countries where high denomination coins have been introduced in the last five years, including Saudi Arabia, Ukraine, Bhutan, the Philippines, Kazakhstan, the Seychelles, Liberia and Ghana.
He then handed over to Dominic Owuso of the Bank of Ghana who took delegates through the country’s recent currency restructuring, involving the introduction of a new high denomination 2 cedi coin and the phasing out of the 1 and 2 cedi banknotes. The results have been extremely positive in terms of easing of vault space, reduced pressure on banknote processing and destruction systems – caused by the poor quality of the 1 and 2 cedi banknotes, and up to 35% savings in annual printing costs.
The next presentation from Ricardo Mendez of Casa da Moneda Chile gave a detailed theoretical framework and provided design recommendations around coin conductivity. He emphasised the importance of considering numerous factors that can impact a coin’s Electro Magnetic Signature (EMS), when designing a new coin. These include materials, dimensions, shape, construction method, manufacturing tolerances, rim height, and engraving. Different coin denominations should have a sufficient non-overlap in EMS to avoid encountering issues with the coin validators in dispensing machines and sorters.
In the following presentation, Ana Pinto Pereira of the Bank of Portugal emphasised the importance of bilateral cooperation agreements for coin swaps to mitigate excess stocks and avoid cash cycle inefficiencies. The Bank found that it was accumulating stocks of €2 coins and, in 2017, adopted a surplus exchange agreement strategy with other national central banks, whereby it would exchange the excess €2 coins to receive other higher demand denominations. They included swaps with the National Bank of Slovakia for €1 coins, the Belgium Treasury for 1c and 2c coins, and the Central Bank of Ireland for all three.
With these agreements, the Bank of Portugal was able to substantially reduce its excess stock and anticipates that any future coin surpluses will be temporary and resolved in the short term with expected demand. Ana concluded by noting that the Bank remains open to establishing future swaps as it can aid with more efficient management of coin stock.
Next, Jeff Hanke from the Royal Canadian Mint (RCM) presented on the modernisation and subsequent launch of Canada’s new coin series. According to the RCM, a successful new coin series features the following: stakeholder consultation, national appreciation, coin material and design, security features, marketing and advertising, and ultimately public acceptance.
Modernising Canada’s coinage involved material changes for the $1 and $2 – which were initially introduced to replace banknotes – from alloys to less expensive and more stable plated options. Both coins also contain laser mark micro-engraving, with the $2 featuring a virtual image for further security. On the other end of the denomination spectrum, the 1 cent (penny) coin has been phased out.
Jeff noted that coins provide an easy way to tell a nation’s history in a way that resonates with the public, stressing the importance of telling the public exactly where they can find your product – in this case, coin. This was utilised with the release of the Bluenose 10c painted coin, with advertising telling viewers that they can ‘find the new painted dime… in your change’. The pad printing used for painted coins also allows circulation coins to have numismatic-like qualities while reaching the greater population at a lower cost.
Day One concluded with a presentation from Mehdi El Ouardighi of Monnaie de Paris and Jihene Maatar of the Central Bank of Tunisia on the evolution of the coin series in Tunisia. In collaboration with Monnaie de Paris, the Bank conducted comparative tests on various alloys, developed technical specifications and samples, and created cost simulations and parallel analysis of prices and quality levels.
The first coin evolution involved changing the composition of three lowest denominations, the 10, 20, and 50 millimes, from brass to brass plated steel. Subsequently, the higher denominations, the 5, 2, 1, and ½ dinar coins, were changed from copper-nickel to stainless steel. The material change enabled the Bank to relaunch the production and circulation of the highest denomination 5 dinar coin in co-circulation with the note of the same value.
The result was the evolution of Tunisian coins towards lighter, more secure, and more economical coins, with a significant cost saving of up to 70%.
Day Two opened with a presentation from Paola Martinez of ARTAZN focusing on zinc-based coins and their security advantages in preventing counterfeiting. She opened by noting that counterfeits tend to increase in times of recession, and that if there is loss of confidence in coin as a trusted option then currency use in general is impacted.
Zinc-based coins may provide a security advantage as they have a consistent EMS – even with differing plating thicknesses – so can be more easily verified, and zinc strips are more difficult to source, providing a greater obstacle for counterfeiters than other, more readily available, materials.
The second presentation of the day, from Dieter Merkle of Schuler and Guenther Waadt of the Bavarian Mint, detailed the introduction and impact of Schuler’s M2R coining centre for tri-material coins at the Bavarian Mint.
The M2R coining centre provides identification of faulty blanks or coins and provides immediate feedback, ensuring rejected coins do not enter circulation. It also utilises Schuler’s digital suite, which sends the machine information directly to the data systems and components, creating a more intuitive and efficient system.
Next, Niklas Harzer from Platit presented on the company’s S-MPuls PVD-hard coating system for coin dies and Ceramicoin, an 100% chromium free coin coating. Ceramicoin is a titanium-diboride non-reactive PVD coating with a thickness of 1.0µm and produces, as a result of its chromium-free composition, no chemical waste or long-term hazardous contamination.
The final presentation of Session 5 was given by Ingo Loeken of Spaleck, introducing Spaleck Inspection Technology. He explained that whilst the core of the company’s business model is still in finishing coin blanks, there is a drive towards digitalisation, and inspection is a part of this – hence the acquisition of the Induvis optical inspection technology last year.
The technology is capable of both 2D and 3D inspection, with the latter providing the ability to inspect concentricity and relief quality and height amongst other benefits. The software and technology are integrated into Spaleck’s coin and blank inspection machine 200R, with an inspection speed of approx. 2,000 pieces/min.
Metals, Costs and Recycling
Sustainability was a theme that ran throughout the conference, touching on recycling, destruction and green production solutions.
This was evident in the sixth and seventh sessions of the conference, with the former focusing on Metals, Costs and Recycling. The session began with a presentation from Jon Cameron of Cameron Associates on the US Mutilated Coin Program – why it was set up, why it is currently in abeyance (it has provided a channel for the introduction of large volumes of counterfeits) and his thoughts as to how it can be reinstated.
These include imposing monthly limits on mutilated coin deposits, prohibiting the redemption of coins imported from outside the US and precluding the redemption of coins damaged in industrial processes, or even abolishing the program altogether and processing mutilated coin through the recycling industry.
Next, an ‘out of the box’ presentation from ArcelorMittal looked at how steel is being decarbonised. Admittedly, in the steel industry, volumes are measured in tonnes, not the grams for coins – but with 50% of the world’s circulating coins either stainless steel or plated steel, there was considerable interest there.
Davorin Dragas of MONEA concluded the session with a presentation on the company’s decoining equipment, providing a case study of the euro changeover in Latvia, where the equipment was part of a programme that saw the removal and demonetisation of 200 truckloads in 1,000 security transfers of Lat coins, equivalent to 300,000 bags.
Sustainability and the Environment
The penultimate session of Day Two focused specifically on sustainability and the environment, opening with a presentation detailing a research study currently being undertaken on the environmental impact of cash versus digital payments.
Representing the Mint Directors Working Group (MDWG), Pascal Rencker provided details of the study, which involves a coalition of 16 partners from the mint and banknote industry working with an institute comprised of various climate research specialists to collect data.
The study aims to address the issue of the environmental impact of cash, in comparison with digital payments such as credit cards and smartphones, utilising Bilan Carbone® methodology to calculate product carbon footprints. Focusing on 27 EU countries and the UK, data is being collected on various life cycle stages of different payment types, with final results and reports scheduled for this time next year.
Marius Straub of H20 then gave a presentation on sustainable wastewater treatment in the coin industry. He specifically focused on the use of vacuum distillation to treat wastewater from the coin blank production process. The company’s VACUDEST solution enables reclamation of secondary raw materials and the recycling of treated water.
The presentation detailed a case study showing the implementation of the VAUCDEST system for MONEA, with cost reductions and low human resource allocation achieved.
Safe and secure coin destruction as part of environmentally friendly recycling was the topic of the next presentation from Susan Lenssen of Royal Dutch Kusters Engineering. The coin crushing machines force the coins into an elliptical and wave shape, with the diameter of the coin changing in two directions and preventing public or coin machine acceptance.
Susan then detailed the environmental and cost benefits of secure in-house coin destruction. These include savings on storage and transportation, as coins are processed in-house and can then be transported and stored as scrap metal.
The presentation ended with a case study focusing on the euro changeover in the Netherlands in 2002, whereby 3 billion guilders were destroyed over several years and the crushed coins sold, creating a revenue of €75 million.
Goran Paladin from the Croatian Mint closed the session with a presentation detailing the preparations for Croatia’s euro changeover. This included production of new euro coins – to enter circulation next year – which involved the establishment of new measuring equipment, processes, and technical documentation.
The Mint utilised the preparation process to begin phasing out the hard-chroming coating line and invest in PVD technology, aiming to reduce the use of hazardous chemicals and waste generated. The coin and die polishing machines have also been connected to a water purification plant to deal with the wastewater.
Goran noted that they found PVD required more electrical power compared to chromium technology, but investment has been made into renewable energy processes, most notably the installation of solar panels across the entire roof of the Mint.
Digitisation – The New Frontier for Coins
A final session on digitisation provided fascinating insights into how blockchain, augmented reality, artificial intelligence, apps and even the metaverse offer solutions to the future of coin production and public engagement.
Anikó Bódi-Schubert from the Central Bank of Hungary detailed the bank’s new blockchain-based platform, ‘The Money Museum Application’, which combines the issuance of a commemorative coin set with that of an NFT set to appeal to the younger and more technology- inclined generations.
Phil Holland from Komori, in partnership with leading metaverse developers Infinity Metaverse, detailed the platform’s potential in supporting currency production in an ever-increasing digital world.
Next, Bert van Ravenswaaij from the Royal Dutch Mint presented on its Herman Brood Medal, and the experience it created using augmented reality and Brood’s own artwork to achieving the deceased artist’s dream of ‘a Brood in every house’.
To close the session, Mikko Sievänen from the Mint of Finland provided an update on Coiniverse, the digital coin collecting platform.
The conference programme concluded with the ‘M1 Cup 2022’, sponsored by MONEA. Fortunately, and unusually, there were no injuries and the football match was greatly enjoyed by delegates.
Sponsors for the event were the Royal Dutch Mint, ARTAZN, Royal Canadian Mint, Freiberger EuroMetall, MONEA, Monnaie de Paris, and Teer Coatings.
The presentations made in Amsterdam will be covered in greater detail in subsequent issues of Coin & Mint News.
The next Coin Conference will take place in two years’ time in Lisbon, Portugal.