Five months ago, Brixton, one of the coolest areas of London, adopted its own currency, shown on the right below – the Brixton pound. (scroll down for photos and videos).
The idea behind it? Helping to maintain a tight and sustainable community by promoting local businesses. The logo says it all: “Money that sticks to Brixton”.
This is how it works: You exchange your regular British pounds for Brixton pounds at an exchange rate of 1:1 to spend in local businesses who accept the currency. While Bank-of-England-issued money is still accepted in local shops, some businesses incentivize their customers to buy their products in Brixton pounds by offering perks and discounts – more bang for their Brixton buck, so to speak. Brixton pounds can then be converted back just as easily.
By creating a more limited space in which money can be spent, local currencies gain “velocity” (i.e.: “The speed with which money whizzes around the economy, or, put another way, the number of times it changes hands” (definition by The Economistt) as they circulate in the local economy, acting as a powerful tool of reinvestment. According to a study done by the New Economics Foundation, money spent in this type of localized economy actually circulates three times as much as it would if spent in national chains! That means, you are essentially “voting with your wallet”. You decide where your money goes.
For local businesses, this represents a huge plus as the profit they make stays in the community – as opposed to moving out of the community, up the ladder to high corporate executives of big national chain. This not only creates stronger ties of solidarity within the community, but it also adds value to the services and products sold in the local economy while building a strong local infrastructure.
In this way then, mom and pop shops are sheltered from the tough competition of chains – who can sell their products at very low prices – jobs are protected in the area, and the community’s sustainability (and survival in these recessionary times!) is assured.
On top of all of that, Brixton’s local currency is helping keep the uniqueness of the neighborhood alive. About ¼ of Brixton’s community is of African or Caribbean descent. Reggae music blasts through the bustling open air market, as you wander along the stands sporting yucca root, sweet potatoes and plantains all interspersed between Halal butchers, Afro-euro beauty parlors and Vietnamese supermarkets.
It is not the first local currency of its kind. Communities from all over the world have created their own – from Australia, to China, Germany and Argentina. Here are some pictures of what some other international local currencies look like.
Brixton is the fourth community in the UK to print their own money, and there are talks that the city of Amsterdam might take it on as well!
For more information on the Brixton pound, you can visit their website at www.brixtonpound.org