Last month we held a round table with the Bristol Pound to find out what the current state of play is for local currencies. We considered scaling options and barriers to scaling, and we explored how the broader community could support or develop local currencies.
Complementary currency schemes are not new; the earliest examples date back to the 19th century. Since the 1980s, however, we have seen their multiplication and gradual diversification. They usually complement official currencies and have been created by NGOs, local authorities, groups of individuals, or enterprises. In the 2000s, a new wave of currency innovations has been promoted in the UK as a part of the Transition Network movement, with the aim to achieve a greater economical and environmental sustainability.
It started with the Totnes Pound, followed by the Lewes, Stroud, Brixton and Bristol Pound. These monetary schemes are designed to be used for day-to-day consumption, subject to individual agreements with local shops and enterprises, but they can also partner with local banks to provide microcredits or with local authorities to pay for local taxes and public services. They are often presented as ‘tools’ that help ‘take back’ money and local economies while nurturing economic alternatives. They also support social change by placing value on economic practices that are not exclusively based on market values and political change by promoting citizen participation in local affairs.
While there is a clear diversity of UK local pounds in forms and purposes, it is difficult to expand an existing customer base and go beyond early-adopters. Adoption rates are rapid at first, with the period of growth rising to a peak. After this there is a decline and some of the currency schemes might even disintegrate (Exeter and Stroud closed, Totnes is about to close, Lake District Pound pivoted to the souvenir sector but is hardly gaining any recurring-customer traction). To understand what are the challenges these monetary schemes face, we invited key thinkers and local currency leaders, with whom we discussed the following areas:
Our report explains these challenges in more detail and identifies what common actions we could take to address them.
What are the next steps?
We discussed whether a shared back office might be an opportunity to find a collaborative solution. We are also keen to find out who else in the broader sector is interested in the token economy or in developing a version two of digital currency, which has the potential to become a nationwide shared platform for local currencies across the country.
If you are working on a project that you think is relevant or you would like to join the conversation, please get in touch at [email protected]
Thanks to all who participated in our roundtable.