Tags: Economy, CalculatorHow to Guides | 09.09.15

Finance News You Need to Be Aware of - The local currency craze

Money makes the world go around, but it is community currency that is keeping small businesses afloat in certain areas of the world. Simply put, community currency is an alternative form of money developed specifically for use in one locality. These new notes are quickly becoming the preferred form of payment among locals in areas such as Brixton in the UK and Massachusetts in the US.

While you can’t use these neighbourhood notes to pay off your home loan, it can be used to purchase items from local businesses that accept this tender. These local currencies are being used as a complementary form of cash that helps to support and bring together small communities and independent traders.

Community notes may not be legal tender, but are becoming increasingly popular in areas of Europe and the US as a way of creating a sustainable local economy.

How does it work?

The local currency works to support businesses that are struggling to survive tough economic pressures and competition by continuously circulating within the community. The community cash stays within the chosen locality, circulating amongst traders and purchasers rather than being dispersed nationally. This also encourages individuals to consider where their money goes and to commit to local purchases.

Australian Community Exchange System

It is not just the European communities that are utilising this new system. Australia has adopted a similar local based form of trade. The Community Exchange System (CES) is a complementary form of currency that allows people to exchange goods and services for mutual credit. The online trading software is used to administer transactions and acts as a way for members to communicate and share services. Even though you may not be able to withdraw your credits to use at the supermarket, it is a handy way to keep your local community running and the neighbourhood economy stable.

Local currencies are an exciting development in our modern economic world. These mini-economies may not be the answer to all of our monetary concerns, but they provide an alternative way of keeping local businesses alive. Take pride in your hometown and consider investigating any local currency options near you.

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