Update: March 2018: For the last two years, LWM has been leading a small working group exploring a potential Birmingham Pound, on a similar model to the Bristol Pound.
We felt Local Pounds were a powerful way of communicating how purchasing locally can generate more local income and keep money in the “real” economy that benefits local people. Local Pounds encourage people and organisations to think about where they spend, and make local spending visible.
Last March, the group concluded that the Bristol model would not be viable for us, largely because it needs too great an initial subsidy and would struggle to be financially sustainable in the longer term. Meanwhile, we struggled to find evidence of impact from other schemes beyond raised awareness of the idea of local money circulation. Admittedly, impact would be hard to measure and this does not necessarily mean the impact is not there, but it makes it harder to justify seeking the required subsidy from charitable investors and harder to persuade non-charitable investors to back it too.
Instead, we began exploring other options, and in particular a mutual credit scheme based on the example of Sardex in Sardinia. Leading on this research was Stuart Bowles, who is also undertaking a PhD on the local currencies theme. This scheme is a business-to-business mutual credit system, where local independent businesses extend one another credit within an alternative currency. The Birmingham Pound working group are confident that this scheme is viable and will meet many of its original aims.
But the model is going to take a huge amount of work and resources to set up and test, and for several reasons it fits a more commercial, albeit still values based, model. The working group concluded it best to step back and allow Stuart to develop the model, although several members including LWM will continue to advise where needed.
The new scheme is called Credex and you can read about it here.
To find out more about the original Birmingham Pound proposals and similar schemes elsewhere:
– Read our Birmingham Pound briefing