The UK has long resisted replacing its pound sterling currency with the euro, and while the Brexit vote means the adoption of a single European currency is as unlikely as its ever been, there’s a growing trend toward the adoption of local currencies that can only be used in a single city.
The Liverpool Local Pound is one such currency – but what exactly is this new quid on the block?
WHAT IS THE LIVERPOOL LOCAL POUND?
The Liverpool Local Pound (LLP) is a digital currency, set to a value of exactly one British pound (GBP). It can be ‘spent’ just like most other digital currencies, typically with a NFC-enabled smart phone or mobile device.
While its official value is tied to the pound, shops and local businesses are encouraged to offer discounts or preferential treatment to those paying with the LLP, thereby increasing its actual buying power.
The intention is to encourage money to be spent locally, and essentially keep the money made in Liverpool within the city. If it can only be spent at local businesses or traded to people (who, one assumes, would only want it in order to spend in local businesses), it can’t really escape the city.
DO ANY OTHER CITIES USE LOCAL CURRENCY?
Well, yes, after a fashion. Totnes and Brixton have toyed with the idea, and even the borough of Brixton had a toe in the water, but this is something rather different.
All previous ‘local currency’ efforts were non-profit, volunteer-led programmes, and didn’t have a great deal of staying power. After all, most of the programmes were run by shopkeepers who had to focus on shopkeeping as well!
The LLP is being handled by Tel-Aviv based Colu with the aid of Independent Liverpool. Colu describes themselves as ‘an ambitious start-up’, despite having headed up the establishments of 2 local currencies in Israel. Coru is also working on an East London version of the LLP. They say that having this be a pro-profit enterprise) and having professionals responsible for its results) will make all the difference.
HOW DOES COLU MAKE MONEY OFF THE DEAL?
As is so common today, they don’t charge a fee or a commission, but they do collect (and sell) user data. As it is a digital currency, it tracks its user’s sending habits. This could allow businesses to better understand their customers, both individually and in groups, and offer them better service thereby. It could also simply be used to target advertising, in a way similar to Google’s user data.
IS IT WORKING?
So far, it seems so. A half a year in, more than 40 Liverpool businesses accept the LLP, and more than 4000 Liverpudlians seem to be using it fairly regularly.
Are you an LLP user, or have you ever used a similar sort of local currency? We’d love to hear your thoughts – share your experiences with our digital community.
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