The Birmingham Pound: a chance to strengthen the local economy?

Birmingham Pound spokesperson, Ridhi Kalaria, speaks to Bioregion Birmingham about this exciting concept.

Hi Ridhi, what's the idea behind a Birmingham Pound?

The Birmingham Pound, or Brum Pound, is a local currency scheme that would encourage people in Birmingham to spend their money locally. It’s a way to strengthen Birmingham’s local economy. With every sterling pound spent in a chain shop, a large percentage of it leaks out of the city. Very little of that pound gets spent in the area where the business is actually located.Brum Pound concept

What are the advantages of a local currency? Will a Brum Pound improve the local economy in Birmingham?

A Birmingham Pound helps the region by:

  • Increasing circulation of spend here, benefiting local people and the city economy;

  • helping this increased local money circulation reach those who need it;

  • supporting the diversity, health and networking of local businesses;

  • creating higher social capital – linking the local economy to local communities;

  • reducing environmental footprint through local resource loops and transport; and by

  • increasing local distinctiveness and identity across the city.

Do you have any examples of a local currency working elsewhere in the UK?

Local currencies are already being used successfully in Brixton, Bristol, and Totnes to name a few. The local pounds are exchangeable with sterling: for every local pound in circulation there is a sterling one in a credit union’s account, making it risk-free to accept them. Local currencies can only be used with locally-owned businesses, which can trade with other local businesses.

The Council could choose to accept council tax and business rates in local pounds (as happens in Bristol), and even pay a voluntary proportion of wages in them. Universities and other big institutions could also participate. All this helps to stop money from “leaking” out of the city, enabling us to relocalise economic power and tackle disadvantage.

Business to business trading is important: this is how the currency goes beyond the loyalty card system to change behaviour up and down supply chains, and how it reaches a wider range of people.

A Birmingham Pound could be spent on a huge range of things: furniture, plumbing, construction, bike repair, coffee, bus tickets, gardening, energy, food – anything!

How well received is the idea among local businesses and Birmingham City Council? 

It’s been well received by the Council and the businesses we’ve approached. The Council has asked us for some impact figures to show how the scheme has worked elsewhere and what benefits it has brought, which we have been working on.

Local businesses are keen to make sure the system is easy to use and that they have ways to spend the Brum Pounds when they get them in. This means looking more at business to business networks, which is something we’re looking for help with at the moment.

What has the project team achieved so far? And do you have a launch date for the initiative in mind?

So far we have worked on financial modelling, looking at ways to make the currency work without relying on funding, this includes looking for ways to diversify income. We’ve recently been approached by someone who would like to help the cause and is able to test some of our financial assumptions, so we can test our plans.

We don’t yet have a launch date. This is because we're really keen to understand how it will work; we want to have a robust financial model in place. We didn’t want to be putting time and resources into launching a Birmingham Pound only to find that the model couldn't sustain itself.

We are happy to receive start up funding to kick off our currency, but we want to at least have planned and tested for self sufficiency and the timescales potentially needed to keep it going. Over the last few months, we’ve been looking at data from other currencies to model how the income and expenditure of the Birmingham Pound might work out over a number of years.

How can people get involved?

We’re always looking for people with a little time to commit to help us to get to the next stage. At the moment we’re particularly keen to explore the business to business market and how we can work in that network, but all other volunteers are welcome.

We have an open meeting on Monday March 27th at 5.30pm where we'll present our findings on impact and finance. We'll also show people nuts and bolts of a Birmingham Pound, so that they can help us scrutinise and challenge what we have found and agree a way forward. We hope your readers will join us.

For more information please visit https://brumpound.wordpress.com. You can also contact the team at brumpound@gmail.com or by calling steering group chair Karen Leach on 0121 685 1155. The project is also on Twitter and Facebook.

Ridhi Kalaria
Ridhi Kalaria is a member of the Birmingham Pound project team. She is also Director of the Ort Gallery, a small Art Gallery in Balsall Heath exploring diversity, and an advisor at local Community Matters Surgeries where people can get help to further their community and volunteer projects and organisations. 

 

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