Bank Note Industry Sees Production Changes

[Bimat]

Check this article on numismaster.

Aditya

[chrisild]

Don't know about the author's conclusions. Giedroyc writes that, if more private companies than now get into paper money production, this may result in "all sorts of new technology". He then mentions the Pobjoy Mint as a (coin related) example. I suppose that some countries will indeed let "Pobjoy style" manufacturers produce fancy notes for collectors.

But in most other cases it works differently: The government, central bank, etc. will decide what it wants, and then (maybe after a call for tenders) pick a manufacturer or more that make(s) the notes. Of course, which materials should be used, or which security features should be implemented, largely depends on what manufacters are able to provide. But I don't think we will see lots of fancy notes merely because some more private printers may be involved in making paper money ...

Christian

[Figleaf]

The Wall Street Journal has an arch-conservative readership that loves any remark on how private enterprise is more efficient than any government. These people are having a difficult time now that private enterprise has to be rescued by the government and the US public is coming to grips with the fact that neither Reaganism nor Neo-conservatism has worked in practice. On the contrary. They are in full denial, of course, but they still need comfort. Allow them their little pipe dream on how at least the bank note world will be saved by private enterprise ...

Peter

[chrisild]

The article also mentions the "Euro production system" as an example of how private printers could get more involved. Well, yes, that 2012 "deadline" is correct. But what will it actually mean? If you look at the ECB guideline from 2004 (press release http://www.ecb.europa.eu/press/pr/date/2004/html/pr041022.en.html here), it says that "a common Eurosystem competitive approach to tendering (hereinafter the single Eurosystem tender procedure) should apply to the procurement of euro banknotes at the latest from 1 January 2012 onwards. NCBs that have an inhouse printing works, or those using a public printing works may elect not to participate in the single Eurosystem tender procedure. In such cases, these printing works will remain responsible for the production of the euro banknotes that have been allocated to their NCBs in accordance with the capital key but will be excluded from participating in the single Eurosystem tender procedure.

Emphasis in bold by yours truly; the full text of the guideline is here:
http://www.ecb.europa.eu/ecb/legal/pdf/l_32020041021en00210033.pdf

As for private security printers, we have an interesting situation in Germany, with one private company (Giesecke & Devrient) and one whatchamacallit: The Bundesdruckerei used to be a federal authority until 10 years ago, was then sold to Apax, a group of investors, and became a private commercial business (part of the Authentos group). That experiment was a bad failure, for a variety of reasons. Since Sep-2008 the Bundesdruckerei has been in federal hands again, so to say ...

Christian