The team at Operational Security Solutions recently attended the 2024 PBC Conference in Washington, D.C., where the spotlight was firmly on the latest trends and challenges facing high-risk industries, including cash management operations. Here are some of the key takeaways from our discussions
1. The Myth: Credit is Cheaper than Cash
One of the most persistent misconceptions in the industry is that credit card or digital transactions are more cost-effective than handling cash. However, with the average processing cost of credit hovering around 3.2%, it’s clear that cash remains the more economical option. When partnering with a quality Cash-in-Transit (CIT) provider, cash-handling costs are well below that of credit card fees. This is a significant advantage for businesses looking to maximize profitability.
2. Maximizing Cash with Smart Solutions
Many businesses are still struggling to fully leverage their cash assets. Solutions like smart safes — which often can provide provisional credit and enable instant deposits —are underutilized. This lack of optimization leads to businesses losing out on potential cash flow benefits. Smart safes also dramatically reduce the possibility of internal theft. Working with subpar cash logistics services can result in further losses due to inefficiencies and poor service delivery.
3. The Subcontracting Pitfall
Another critical issue discussed was the prevalence of subcontracting in cash management. Some third-party service providers promise nationwide coverage but then hand off the actual service to subcontractors. This practice often leads to a loss of control over service quality, putting businesses at risk. We strongly advise clients to ask upfront who will be managing their account; do they have adequate insurance protections; and ensure that the service provider has a direct relationship with those handling their cash.
4. Optimism for the East Coast Market
Despite some well-publicized challenges with program rollouts—particularly in New York—there’s still a strong sense of optimism for the East Coast market. Regulators and potential operators from emerging states, including Delaware, expressed confidence in their upcoming programs. This enthusiasm signals that, while hurdles exist, the market remains ripe for growth and opportunity.
Finding a Cash Management Partner You Can Trust
The PBC Conference reinforced the importance of strategic cash management and the need for businesses to be vigilant about their logistics partners. By understanding the true cost of credit vs. cash, leveraging advanced cash solutions like smart safes, and ensuring transparency with service providers, businesses can thrive in an evolving financial landscape.
At OSS, we pride ourselves on our commitment to exceptional customer service while offering industry-leading expertise in cash management solutions, including cash-in-transit services, ATM and Smart Safe solutions, and compliance for financial institutions and cash-intensive businesses. Ready to learn more? Get in touch with our team below!
