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Stroud Pound

Introduction

The Stroud Pound is a complementary currency launched in Stroud, Gloucestershire, U.K. in 2009 by the local Transition Town initiative. The Stroud Pound is the third Transition Currency, following the Totnes Pound and the Lewes Pound.

This currency was introduced in order to support and stimulate local economic activity, by committing consumers to purchase locally produced goods and services, thereby encouraging the development of local businesses and jobs. The scheme was inspired and modelled on the Chiemgauer, a regional currency running in Bavaria, Germany. This has led some people to consider it an application of a Regiogeld currency in the UK 1.

As of 2010, there were about 180 members using the currency and 44 businesses accepting it. Overall, more than 10,000 GBP were exchanged for Stroud Pounds, and 4,126 Stroud Pounds were in circulation. Usage at present however is very low.

The local community is working towards a re-launch and are working on trying to persuade the council to be involved.

Purpose

The central aim of the Stroud Pound was to build a strong local economy by stimulating consumers to buy local products and services and thus encourage greater production and exchange on a local basis 2.

More specifically, the goals that the Stroud Pound sought to meet were:

1. Retain more locally created economic values within the locality and prevent leakage into the global economy, as happens with sterling exchanges,

2. Increase and sustain local economic activity and help insulate Stroud’s economy from the worst effects of recession

3. Increase trade locally and support the creation of more jobs

4. Help consumers identify which businesses support the local economy

5. Reduce the length of supply chains for local consumers

6. Stimulate greater local production

Community Overview

Stroud is a market town of about 12,700 inhabitants in the Gloucestershire County, U.K. Cato and Suarez (2012:109) describe that the town is as an example of a sustainable community located in a rural area, about 30 miles north east of Bristol. It is a former textile town that suffered from the industrial restructuring post WW2. Stroud has attracted many artists, environmentalists who have led the development of social innovations and green lifestyles projects 3. Stroud was home to one of the largest and successful LETS schemes in the country 4.

Organisation and History

Stroud was one of the first Transition Towns to be launched. The idea of introducing a local currency soon became attractive and gained momentum after Christian Gelleri, one of the initiators of Chiemgauer, ran a workshop on local currencies in the town. Soon after, a working group on the Stroud Pound formed to prepare the launch of the currency, who’s design was deliberately based on the Chiemgauer.

The Stroud Pound Co-op Ltd., a non-profit, runs the Stroud Pound on behalf of all the members. The process of running the scheme was designed to be democratic, meaning that all members have a say in its design and implementation.

Currency Details

The Stroud Pound in numbers

In 2011 there were only 4000 Stroud Pounds in circulation, with about 180 members using the currency in less than 40 shops

Function and Unit of Account

Stroud Pound was made to act as a unit of exchange. The unit of account was the Pound Sterling, which means that the purchasing power of one Stroud Pound is equal to one Pound Sterling.

Issuance – Backing

The Stroud Pound was available in paper notes in four denominations (1, 2, 5, 10), each of which were backed by Pound Sterling held in a pooled bank account. The notes were printed on watermark paper with several security features.  Members could exchange Pound Sterling to Stroud Pound at a 1 to 1 exchange rate, however were required to donate 3 % of the value exchanged to a local charity or social enterprise they wished to support.

Specific Attributes (optional)

The Stroud Pound incorporated three features designed to stimulate circulation:

–        Limited lifespan of two years,

–        Demurrage of 3% every six months, thereby members had to attach a stamp of the value of 3% of the face value to keep the currency valid,

–        Malus of 5% for exchanging back to Pound Sterling

Funding – Business Model

In order to become members and join the scheme, people were required to pay a joining fee of 5 Pound Sterling, which would then contribute to cover the operational costs of the scheme.

How it works in practice?

Consumers joining the program were required to pay a one-time joining fee of 5 Pound Sterling.  Members were then able to exchange their Pound Sterling for Stroud Pounds at a 1 to 1 exchange rate, and spend them at the local participating businesses listed in the directory. For every currency unit exchanged, members were required to donate 3% to a local charity or social enterprise. If members wanted to exchange their Stroud Pound back to Pound Sterling, had to pay a 5% fee, which was there to discourage this practice.

References

  1. North, P. (2008) Money as Liberation: the micropolitics of alternative currency movements, Minneapolis:University of Minnesota Press
  2. Scott Cato, M. and Suarez, M., (2012) Stroud Pound: A local currency to map, measure and strengthen the local economy, International Journal of Community Currency Research 16(D):106-115, available at http://ijccr.net/2012/07/08/stroud-pound-a-local-currency-to-map-measure-and-strengthen-the-local-economy/
  3. Large, M. (2010) Common Wealth for a free, Equal, Mutual and Sustainable Society, Stroud> Hawthorn Press
  4. North, P. (2008)  Money as Liberation: the micropolitics of alternative currency movements,  Minneapolis:University of Minnesota Press
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