G&D and Kusters: Expertise at the Razor’s Edge

An interesting article on the disposal of polymer banknotes.

The disposal of polymer banknotes unfit for circulation is the final, yet important phase in a banknote’s lifecycle. In our Industry Interview, we have a look at the destruction of polymer banknotes. Angelo Kok, Chief Commercial Officer at Royal Dutch Kusters Engineering, and Alfred Schmidt, Product Management Director at banknote producer Giesecke & Devrient, responded to our questions.

What are a central bank’s considerations when they think about investing in an online shredding unit on a Banknote Processing (BPS) machine, or in offline shredding equipment?

G&D: If a central bank decides to invest in a BPS, be it a new installation or the replacement of an old machine, the question of whether to include an online shredding unit on the new BPS is almost a “no-brainer”, given the relatively low additional cost of this unit, compared to the total investment for the BPS.

Very important aspects for the central banks are the uncompromised security during the online destruction process, and the precise and infallible documentation on the banknotes sorted out as unfit and their subsequent destruction.

Kusters: One very important matter when central banks evaluate shredding solutions for banknotes is the guaranteed size of the shreds. Central banks often demand a guarantee that no shred exceeds a maximum size, e.g. 6x6 mm. Kusters Engineering is able to guarantee any required shred size due to the applied patented technology of shredding and granulating using a screen at the outlet of the final stage of destruction. Not a single particle larger than the holes in a specific screen can pass this Kusters Engineering classifying stage.

How many BPS machines running at central banks are equipped with a shredding unit, versus without a shredding unit?

G&D: In the past few years, 100% of the new BPS M7 machines for central banks have been equipped (and are used) with online shredders. In some countries, very small branches may use compact banknote processing systems without online shredders (ie. the BPS C4 or Numeron), and send the unfit notes to a large cash processing centre for reprocessing and destruction.

Meanwhile, compact processing systems are available for online shredding in smaller branches, e.g. BPS C4-S.

Some countries operating on a low automation level in the cash cycle only use manual verification combined with offline destruction, or, in some cases even incineration, for the lower denominations.

Is there a minimum shredding volume per annum to make shredding economic?

Kusters: No, there is not. As soon as there is a need for the secure destruction of unfit banknotes, the economics of the process are not considered of critical importance.

What are the key challenges when it comes to shredding polymer banknotes and the subsequent compacting of the shreds?

Kusters: Firstly, the applied destruction technology must make sure that, after shredding, reconstruction of a banknote is impossible. One way to make sure of that is, apart from the shred size, to mix pieces of shredded banknotes in the waste collection.

Secondly, to set up the equipment in the available space inside the designated areas in existing (sometimes old) buildings represents a challenge that can, however, be solved most of the time by Kusters Engineering.

G&D: The online shredding of polymer notes is rather challenging, as damaged polymer banknotes are often repaired with tape. The tape residue can clog the blades and extractors with sticky substances, thus requiring more frequent cleaning.

The compacting of the shreds is part of the external shred removal system, rather than the BPS.

What solutions do you propose to resolve those challenges?

Kusters: As an engineering and manufacturing company, developing currency disintegration systems (both for banknotes and coins) is our core competency and as such we never walk away from any challenge.

G&D: G&D is offering a specifically optimised version of shredder blades and extractors (based on material with the highest durability and optimised shape) for polymer banknotes to reduce the effort for cleaning and/or re-sharpening.

What is the shredding capacity of your equipment?

G&D: The shredding capacity of the BPS supports continuous 100% shred rate at full speed (up to 158,400 notes per hour for G&D machines). With the precision of the BPS shredder blades and a typical shred size of 1.5x16 mm, there is no risk of overheating or any other limitation, independent from the substrate.

The energy consumption for online shredding is approximately 2.0kW for up to 150kg/hour.

Kusters: We offer different equipment, with capacities ranging from 50 to 1500kg/hr. Limiting factors are the size of the package in relation to the required capacity as well as the available space (especially in old buildings).

What is considered best handling practice in order to maximise the efficiency of offline shredding?

Kusters: Besides the two-stage destruction process we offer, the efficiency is greatly influenced by the bank’s loading procedure. In other words, the preparation of the batches. Once the unfit notes are locked up inside the system, the whole process is fully automated and cannot be influenced any more.

Is the shredding of polymer banknotes any different from the shredding of paper banknotes? If so, how do you handle this difference?

G&D: The online shredding of polymer notes is more challenging for several reasons. First, the polymer substrate, due to its initial tear resistance, requires a higher sharpness of the cutting blades, and hence, more frequent resharpening (typically after 20 million polymer banknotes versus 50 million paper banknotes) is necessary. Second, the cleaning of the extractors may be required more often, but this depends on the amount of sticky-tape residue and whether it is mixed with paper substrate. Paper notes generally exert a self-cleaning effect of the shredder blades and the extractors.

Kusters: It certainly is, but we have plenty of experience in this matter, so there are no surprises. We use basically the same equipment for both substrates. However, for each substrate we use knives that differ in size, shape and material. As you will understand, the details of our technology are “the tricks of the trade” and hence, we cannot reveal too much.

A central bank, based on its environmental policy, makes its own decision whether to destroy only pure material (ie. only polymer or paper) or any mix of both substrates. Whatever is needed, Kusters Engineering can offer a suitable solution for the destruction as well as the shred handling.

Can you share any data on shredding rates of paper versus polymer?

Kusters: The destruction efficiency of polymer is about 10-20% higher. The cut of the polymer is cleaner, with a sharp edge, whereas the cut of paper is more fluffy due to the fibres. Also, polymer produces less dust compared to paper.

Paper can be compacted much more. The compacting ratio of paper is about 1:5, whereas it is about 1:2 with polymer. Let me explain: the waste of one cubic metre of loose polymer shred weighs about 125-150kg, and about 250-300kg when it is compacted. Paper weighs about 100- 120kg when it is loose, and about 500-600kg when it is compacted.

Since polymer cannot be compacted as much as paper, some central banks do not compact polymer shred. Also, some recyclers prefer to receive the polymer shred loose, but they also accept briquettes.

G&D: The shred rate is primarily a question of the central bank policy, with the return frequency and the fitness standard as the dominant parameters. A central bank with “delegated style” may have an unfit rate of 100% because it only accepts deposits with unfit notes. A central bank with a high return frequency, applying a “controlled” or “co-operative” style, may see an unfit rate below 5%. This data does not support lifetime calculations without further analysing the complete cash circulation and conditions thereof.

The overall lifetime of polymer notes in circulation is often stretched too far, as most commercial processing systems have limited capabilities to detect ink-wear, the primary reason for unfit polymer notes. Therefore, polymer notes are often returned after having reached a progressed unfit stage, very often only after tears had been repaired with adhesive tapes and the mechanical defects have become obvious.

How is the shredded material delivered to a recycler?  How does this differ from preparing material for landfill or waste-to-energy?

Kusters: The physical proportions of the shredded waste, on its way to an end-user, be it a recycler, landfill, incinerator, etc., are the result of the consideration of various factors. It is important to know in what condition the enduser can receive and handle the waste, the costs of transport, etc.

As no country is the same, these considerations must be made by each individual customer before deciding how the waste should be when leaving the shredding system. Briquetting lowers costs of transport but if a recycler cannot handle briquettes, compacting is not wanted as it reduces the options for recycling. Each and every project therefore has its own possibilities and limitations to consider.

G&D: The BPS delivers shreds to be removed by an external suction and shred collection system. The central bank specifies the further handling of shred materials, ie. recycling and/or waste-to-energy conversion requiring compacting.

Quite often we see shreds sold as souvenirs of destroyed money. The shred fragments may appear like a complex puzzle – but so far nobody has recombined a genuine note and used it for payments. There’s no risk for the central bank, even when exploring a large landfill.

About the companies:

Kusters

Royal Dutch Kusters Engineering was founded in 1911 and specialises in the development and manufacture of disintegration equipment for banknotes and coins.

G&D

Giesecke & Devrient is a leading manufacturer of banknote processing systems. The company has experience in online shredding that goes back to 1986, when the first BPS ISS 300 PS with an online shredding unit was installed.

This article was originally written by Innovia Security in their The Biannual Journal of Guardian publication, Specimen, Issue 5, Pgs. 10-11.

This is a guest article. The thoughts and opinions in the piece are those of their author and are not necessarily the thoughts of the Certified Collectibles Group.


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