Oumolat Means Currency, and Business

Oumolat Security Printing, which began operations in 2016, is not only the industry’s newest banknote printing company. Located in Abu Dhabi, it is also the first in the Middle East, taking advantage of the strategic location to offer banknote printing and services to the world.

Martin Wenzel

 

The High Security Printing™ (HSP) EMEA conference recently held in Abu Dhabi was an opportunity for delegates to hear more about Oumolat (the name is Arabic for currency), for central bank delegates to visit the state-of-the-art printworks, and for Currency News™ to speak to Martin Wenzel, its General Manager since 2019, about what was behind the decision to build a printworks in the UAE, the advantages and unique strengths it can offer, and where it sees itself in the future.

Q: You were the first new banknote printer in decades. What was the rationale for setting up a banknote printing facility in the United Arab Emirates (UAE), particularly at a time of, some would argue, over-capacity in banknote production?

A: The UAE wanted to set up its own banknote printing factory to secure a reliable supply of banknotes and complete a new series. The new series was developed flexibly in a short time from design to production and issuance in circulation. But there is also an advantage that the choice of substrate and features is more flexible for the Central Bank of UAE, and Oumolat, as the printer, can integrate the substrate and features from many independent sources.

One key difference to a banknote printer setup for fulfilling domestic demand, however, is that Oumolat was, from the beginning, created to get into the export business – from the machines, the skills of employees and the flexibility of processes. Oumolat is there to leverage the intensifying relationships between the UAE and other governments, the emergence of the UAE as a business hub and its proximity to many customers.

Over the first six years we have demonstrated that Oumolat could do export work from the outset. We started with subcontract work. Now the focus is on direct export and building customer relationships. But in the last six years, 50% of the banknotes produced were already for export, and we printed 3 billion notes. This both shows efficiency for one shift operation and significant export growth!

Q: Can you describe the company then and now – ownership, structure, capacity, and size?

A: Oumolat was owned and started by the Emirates Investment Authority (EIA), which is the sovereign wealth fund of the federal government, then transferred to the Central Bank of UAE.

It operates as a separate, private company. Oumolat employs over 100 employees for banknote printing and has one printing line. The output in one line is scalable by introducing additional shifts, but currently, Oumolat is producing in one shift with overtime flexibility, a very significant performance. More shifts would allow for more than doubling the current output.

Initially, the options for more banknote printing lines were considered, but now Oumolat will focus on growing banknote exports with the existing line and diversify in related fields of high security printing and payments, with the same model. In other words, by supplying the local market and then going for exports, in the target regions, leveraging the importance of the UAE in the GCC (Gulf Cooperation Council) countries, the Middle East and Africa, or even globally.

Q: As the only printer in the region, are you looking to become the regional hub and source for banknotes?

A: There is no expectation that all regional countries will pool their production of banknotes under Oumolat; we approach other countries and welcome them to discuss if they are interested in printing with us, not only in the GCC area.

It would be beneficial for countries to consider using Oumolat as their printer for the proximity of delivery and our independent printer status. The customer can choose features and substrate and get advice, and we print.

We are keen on establishing long-term agreements with countries to print for them and help them to avoid capital-intensive investment in a printing plant, but offering our company as a printing hub, not for a whole region but some countries.

Q: Intellectual property (IP) is central to many banknote printers’ success. Have you managed innovations of your own? Have you filed any IP? Or do you rely on third parties/partners for this?

A: We have the most flexible production equipment to produce most banknotes in circulation, but we do not have IP on features and substrates; we work with partners and have access to all suppliers to work together on banknotes.

If we have access to all suppliers, we also can offer the widest choice to central banks to design new series or replace current features to either become more secure, change the design, or also improve the costs.

With an independent printer, customers have the maximum flexibility and can also easily use all possible features from different suppliers. This flexibility could be an argument to come to us for a wider choice and for the flexibility to adapt existing banknotes by replacing current features.

Maybe with a partner, we might develop features in the future, but at the moment, we do not have a plan for that.

Q: What is the cash situation in the UAE? Is demand growing or declining?

A: Over the past six years, the banknote quantity remained stable; with the notes of the new series, the same quantities are maintained. It remains to be seen if the more durable polymer substrate for the new series and an increasing shift from cash to electronic payments will lead to decreasing demand.

But Oumolat was set up to serve the countries where demand for banknotes is still increasing, mainly in Africa. Any decrease in local banknotes would be compensated by an increase in export.

Q: The new UAE dirham (AED) series is being produced on polymer. How is that going in terms of production and public reaction? And why was the decision made to switch?