DEPOSITA’S AUTOMATED CASH DEVICES ARE BUILT BY SOUTH AFRICANS FOR THE SOUTH AFRICAN MARKET
“If you look at South Africa, like the rest of the world, we are in the grips of the COVID-19 pandemic with increasing concern over the rise of cyber-attacks. The movement towards digitalisation and working from home has increased vulnerabilities and will have a detrimental effect on the economy,” says Deposita’s Operations Director Leon Ehlers on the current trends in risk management.
Leon – who is responsible for overseeing all operational aspects at Deposita, including technical support, installation and risk management – also notes that the retail and wholesale sectors of South Africa have unfortunately experienced a recent increase in robberies and attacks. One critical event was the looting and unrest that occurred in June and July 2021. “Previously, looting happened on a much smaller scale, but events like that will significantly affect risk in the future,” he notes.
With a career that spans 18 years in the South African Defence Force and nearly 15 years at Deposita, Leon is well placed to provide a unique, unassailable, strategic approach to customers’ risk management – which sometimes feels like a never-ending battle against crime.
Below, he shares deeper insights along with solutions for businesses in need of better protection.
How is the South African risk management landscape different to international trends?
In America and Europe, the general trend is moving more aggressively to a cashless society. However, in certain countries, intending to be entirely cashless, amendments to laws have come into effect to ensure the availability of cash through banks and ATMs and the acceptance of cash as a payment method.
Cash won’t fade in South Africa, and specifically, in Africa. There are just too many economic restraints. If you look at the rural areas, most of the wholesale and retail businesses are cash businesses. And as long as that continues, we will have a lot of cash flow in society.
Maybe in the more metropolitan areas, we will see some movement towards a cashless society. But I predict up to 50% of transactions will still be conducted using cash in the future. And as soon as there is any pressure or natural disaster like the COVID impacts has shown, people tend to move back to money.
How has South Africa’s unique risk management landscape enabled Deposita to create more secure devices than your competitors?
In the last decade in automated cash accepting devices, everybody has worked towards design and installation improvements of the automated cash accepting devices. At Deposita, our daily focus is on the hardware department and the software, ensuring a safe, effective and client-driven end-to-end cash management solution department. Specifically on the research and development to ensure optimum product safety and protection while driving particular efficiencies. We also take the time with every client to understand their situation and what they need. We guarantee operational efficiencies and reduce the risk for their staff, customers and onsite cash.
Has the economic impact of the pandemic changed criminal behaviour and strategies or incidents over the last year?
The crime statistics released by the Institute of Security Studies in August last year, from April to June 2020, crime decreased, specifically murder and armed robberies. Murder declined by, more or less, 36% and armed robberies declined by about 40%. But, that has changed in the last eight months, and we are back to pre-COVID crime levels.
Cash-in-transit heists have unfortunately picked up. Robberies increased on businesses dealing specifically with cash. Also, petty cash theft – jumping over a counter to grab money out of the till – increased.
What do you specifically look at in risk management?
If you consider the effects of crime and the value that Deposita offers, we have always tried to maintain a back-office solution and a robust hardware solution. From the beginning, we have tried to minimise the risk from the point of sale to settlement. The verification system in our devices ensures that we don’t accept fraudulent notes. We also protect against physical attacks on our devices and have made numerous design improvements based on detailed analysis of trends and previous attempts to gain forcefully access to our devices. Many of Deposita’s software developments are trade secrets even to our technical staff.
What role does Deposita play in risk management for customers?
Risk management is essential for every client. We try to identify, assess and control threats and risks to the client’s capital and earnings. Every business faces these risks. Unexpected, harmful events can cause a lot of pain points. We try to mitigate these risks for the customer. We always discuss their current situation and provide them with a solution to protect their assets, customers and personnel.
We’re also deeply connected and involved within the industry with representation on all the relevant committees relating to industry standards and risk trends.
Who needs to be concerned about risk management? How important is it?
All stakeholders involved in the cash cycle, from the cashier to the financial institutions, including cash-in-transit personnel, need to be aware of risk management. It benefits the whole cash cycle if you can detect a weakness early and prevent subsequent long-term losses.
What do you think the future of the industry looks like in light of these trends?
I think it’s essential that we focus on evolving software and hardware solutions. Theft and crime will not change, and violent robberies will most likely increase. We know violent crime will not disappear in South Africa and Africa.
The looting and unrest we experienced offer opportunities for us to enhance our hardware and applications, which is the heartbeat of Deposita. We continue to find better solutions for our customers dealing with cash and offer diverse alternative payment solutions.
How does Deposita investigate incidents?
We are very aware of incidents, their effects and the current trends. We don’t just investigate after an incident occurs – we have processes built into our systems that raise red flags before anything happens. If unauthorised access to a device occurs, we assess the situation and look at the techniques used. That information is passed on to our research and development teams to analyse and make improvements. We also always go back to our clients with recommendations to help protect and safeguard their cash and staff.
How does Deposita’s risk management benefit customers?
The main benefit is Deposita’s end-to-end solution. We provide our customers with a sense of comfort that their cash is protected end-to-end and insured. With our solution, our customers’ risk reduces tremendously.
How does Deposita’s solution impact insurance?
Deposita has long seen the advantages of teaming up with insurers to address clients’ needs. We work closely with industry experts to provide different types of cover, from end-to-end to device-only or onsite-only insurance. We cater for the full spectrum of our clients’ needs.
Our insurance is placed locally and abroad to help risk management. We communicate daily with our specialist brokers to ensure seamless, professional claim handling and settlement management. We handle incidents as quickly as possible so clients can carry on with their business as usual with less interruption.
There are a lot of device companies offering various products. Deposita was one of the first to provide insurance covering the end-to-end cash cycle. And our model is built on ensuring customers are worry-free as soon as their money is in the device. Then it is secured, and they know that the cash will be banked in their account.
If anything happens to a device, customers know that Deposita will handle their claim and replace their device so they can carry on with business as usual.
How does Deposita compare to competitors?
South Africans developed the Deposita solution for the South African market. The lessons we’ve learned since 2005 have helped us improve our product, not just for the African market but also for global markets.
Our products are manufactured and assembled locally, allowing for the highest level of quality control. We provide clients with insurance if something goes wrong – we assist as quickly as possible to ensure their device always runs smoothly.
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