Right on the Buck

The debut of the new U.S. $20 could have meant a substantial challenge to the U.S. Postal Service when these numbers are considered: 38,000 offices nationwide, many more cash-operated vending machines, an 18-month notice from the Bureau of Engraving and Printing (BEP), and only six months given to Money Controls Inc. (http://rbi.ims.ca/3845-514) to retrofit the 40,000 bill acceptors it has sold to the USPS.

But the USPS and many more businesses were poised to open their doors last October to the newly introduced $20, thanks to the software upgrade solutions pre-conceived by many cash-handling machine manufacturers to ease machine retrofitting. In fact, the BEP is counting on these software upgrades to help keep the ka-ching going all over the world when it later introduces the new $50 and $100, sending shockwaves to overseas markets where high U.S. denominations are widely circulated, comments Dawn Haley, spokeswoman of the BEP.

Key to banknote validator's functions is the software that interprets information collected by the sensing devices on the machine, says Paul Pechinko, product manager of Money Controls. Declining to disclose further programming details, Pechinko says Money Control software can read both sides of a bill and validate optical and magnetic properties, such as print patterns, as well as physical characteristics, such as the standardized U.S. banknote length measuring 156 mm.

As long as none of these traces are drastically changed, Pechinko asserts, in terms of machine retrofitting, Money Controls bill acceptors need only software upgrades. "From the programming standpoint," he adds, "with the development and testing [of the new software], the overall time is probably less than a month."

Such efficiency was particularly critical during the new $20 debut. For security reasons, not until six months before the public release did Money Controls receive a test deck of 1,000 new $20s from the BEP and was able to study the design to reprogram its bill validation software. While the program was updated within a month, the company had only five months left to retrofit the 40,000 Ardac DBA7 bill acceptors it sold to the USPS in 1999.

But "the process was pretty quick," comments Mark Saunders, spokesperson for the USPS, thanks to easy software installation made possible by Money Controls' information transferring units (ITU).

In accordance to the sale contract, Money Controls has developed 3,000 software download boxes called the ITU for the USPS. In light of the new $20 release, 1,600 units were sent back to Money Controls to receive new ITU chips that carry the updated bill validation program. These boxes were then delivered back to the USPS, which now could download and install the upgraded software onto its Money Controls bill acceptors, which never had to be shipped back to the manufacturer for retrofitting.

Pechinko declines to release payment details from the USPS. But he adds that bill-handling machine manufacturers must "keep the costs down because there's a lot of competition in the market." His overview is echoed by MEI (http://rbi.ims.ca/3845-515), an electronic payment systems maker targeting the vending, gaming, retail, amusement, lottery, and transportation industries worldwide.

According to MEI, its customers only had to pay as little as $10 to retrofit each MEI machine for the new $20. In a company statement, users of the MEI Cashflow SC or Series 2000 bill acceptors were told that they could receive software upgrades by remote FLASH download at $10 to $20 per unit. Other retrofitting options were also available to those who have the AE2600 machines. They could order a control board trade-in at about $75 per unit, the company says.

MEI estimates that 250,000 of its machines were affected by the new $20 release, and the number is likely to go up when the new $50 and $100-debuting this year and in >>2005 respectively-reach MEI's overseas markets where high U.S. denominations are widely used, comments product manager Bob Martin.

The impact may go even further now that the BEP has announced the plan to roll out new currency designs every seven to 10 years to stay ahead of currency counterfeiters. But with their easy software upgrade solutions and timely machine retrofitting experience, bill-handling machine manufacturers and users are poised for future challenges.