New local digital currencies have been introduced in response to the decreasing trust in banks by millenials and the desire to bolster local communities.
One example of this is the recent launch of the Lake District pound, which is accepted in over 200 locally owned businesses and attractions.
The Lake District pound notes feature famous local people such as Beatrix Potter and William Wordsworth.
Some of the local currencies from around the UK are:
The Hullcoin, launched in 2014 is the first local government owned cryptocurrency in the UK. Hullcoins can be earned by recycling and taking part in community projects, with the coins being able to be used in local businesses. 146 retailers and 800 people are using the currency as of mid 2017.
The Brixton pound
Launched in paper in 2009, the Brixton pound is now traded on an electronic platform through text messaging. There are 1,000 regular users of the currency, who traded £50,000 worth of Brixton pounds in 2016.
The Bristol pound
£1 million Bristol pounds are now in circulation and it can be used at 800 businesses across the city and wider area, making it the largest local currency in the UK. The scheme is backed by Bristol Credit Union.
The Totnes pound
The Totnes pound has been in circulation since 2007 in the Devon area, with the electronic version debuting in 2014. The Totnes pound rewards purchasers with loyalty points that can be built up towards future purchases or given to charities.
The Kingston pound
The Kingston pound is a relatively small currency with 100 users that have spent more than £8,000 since 2015.
The Liverpool pound and east London pound
Early 2017 saw the launch of the Liverpool pound, which now has 100 local businesses and 16,000 users. The east London pound has acquired 2,000 users and 70 businesses since June 2017.
The Colu app provides access and acts as a digital wallet for both currencies.
Be aware that these currencies are not legal tender, reducing the level of protection for end users in the event the scheme collapses.
According to the Bank of England however, participants in schemes that have backed their currency with pounds should be able to get their money back. Schemes that are backed by credit unions that are regulated by the Financial Conduct Authority could also benefit from protection for individuals of up to £85,000 in the event the credit union itself were to fail.
Information is based on our current understanding of taxation legislation and regulations which is subject to change.