Keith Jacques, author of flagship report, The Future of Global Security Printing to 2028
, discusses the major trends and general outlook for the industry.
Keith Jacques has over 40 years’ experience working in the coatings and associated raw material industries in a variety of roles: product development, sales and marketing, and investigating business development opportunities. For the last 15 years Keith has been involved in market research on a wide range of topics within the coatings, adhesives, raw materials, and print sectors.
What is the major threat to the security print industry?
The security print industry usually adapts to change at a slow pace, but digitalisation is a long-term threat. Increasing use of smartphone payment apps will reduce reliance on debit and credit cards, even the new contactless versions, although payment cards will remain as the preferred option for many. The switch to digital ID documents such as passports and driving licences carried on smartphones may start to replace physical versions over the long-term – although current versions still need to be supported by a physical document. I also expect that there will be a greater use of e-tickets for travel and entertainment events and this is already impacting the ticketing sector which has been in decline for more than five years. Whilst geographically, China has a medium-term goal of becoming a cashless society.
What has changed in the security print market in the last couple of years?
The growth in online shopping that was accelerated by the pandemic lockdowns has opened new opportunities for criminal activities through counterfeit consumer goods, pharmaceuticals, and alcoholic drinks. Brand owners are responding by stepping up their security measures on product packaging and labels to verify the authenticity of their products.
Digital payments through smartphone apps and contactless debit cards are growing at the expense of cash payments. However, cash is still a major payment method in developing countries where rural communities do not have ready access to online banking, or even have a bank account. These factors affect the long-term trends in banknote production.
One factor affecting the short-term trend in banknote production, is the economic/cost of living crisis. Due to inflation, consumer spending has changed, and many are favouring banknotes over card payments to discipline spending. Factors like this have distorted bank note production, circulation, mix in circulation, and digitalisation as consumers are also storing cash.
Personal ID documents such as passports and identity cards are gaining additional digital and biometric security features, to keep ahead of counterfeiters’ evolving technical capabilities.
How is the security print market adapting to changes within the print industry?
Documents requiring high levels of security such as banknotes and passports still rely on traditional printing methods such as intaglio, offset litho and letterpress. The effects that can be printed using these processes cannot be duplicated by counterfeiters using digital print such as inkjet. There is a growing use of digital print processes in security printing: product labelling and packaging needs to be protected with individual and unique serial numbers, which use digital printing technology.
Security threads and DOVIDs are under continual development to keep ahead of the efforts of counterfeiters to produce credible copies. The production of copies that are more difficult to detect is increasing, as technology becomes more accessible. This is driving improvements to the security features for documents including passports, identity cards and banknotes.
What opportunities can the security print market witness over the next five years?
Breeder documents (documents used to support applications for identity, residence and travel documents, such as birth, marriage and death certificates), are seeing developments to improve security. This is expected to affect the security print market, and the move to digital documents can jeopardise the physical printed document market.
With improvement in technology, lower-level items could see enhanced security features in the future, such as the use of holograms. This could result in an increase in a number of products that use such security.
Moreover, a larger proportion of countries are adopting polymer or hybrid banknotes to increase the lifespan of currency (hybrid banknote substrates have a cotton paper inner layer protected by polymer outer layers). Polymer notes have around four times the life expectancy of paper versions, extending the renewal intervals and reducing demand over the long-term. Companies are now considering how to adapt bank notes for consumer preference, and big players are making changes with hybrid notes.