What is a cash recycling system?

The simple definition is “a device that’s capable of receiving, storing and dispensing money”. An obvious example would be the bank ATMs we use all the time. You can withdraw from your account and make deposits without even involving a teller. The newest machines recognize the denomination of the bills and count the money as you put it in.

The coin counter machine we see in some grocery stores would also qualify as a cash recycling system. Put in your loose change, and you get a receipt to exchange for the equivalent amount in dollars (minus a fee, of course).

The logic behind a cash recycling system is that, in most cases, the cash that goes in is the same cash that goes out. Your deposit becomes a withdrawal for others. That’s a huge money-saver, because there are no humans having to be paid to do the work. When you make a cash deposit with a teller, you’ll notice that the money is counted at least twice. That’s costly in terms of time, when you consider how many such transactions occur in one business day.

Behind the scenes, banks use money counter machines to insure 100% accuracy. The primary reason, though, is that they save so much time. Fully electronic cash counters that could handle batches of bills were introduced in England in 1980. There are coin counter machines, too, of course.

And new cash management software solutions include giving the bank customer the ability to use his or her smartphone to take pictures of a check and then deposit it without even going to the bank.

From the financial institution’s standpoint, of course, it’s all about saving money. But these cash handling innovations being developed by for and implemented by the banking industry make things much easier for the customer at the same time.