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How Fintech technology is empowering communities to create local currencies: The Brixton Pound Story

April 29, 2024


The crash of Wall Street in 2008 plunged the world into its most significant recession since the Great Depression. Local currency emerged as a solution that could buffer communities against rising inflation. Incentivizing communities to shop locally and creating local currency have really taken off in the last few years, and more cities are adopting local currencies. 

Thanks to Fintech, creating and trading local currency has become easier than ever. In trying to understand how local currencies have benefitted from Fintech, let’s look at one of the most successful case studies, the Brixton Pound. 

The Brixton Pound: A Case Study of Local Currency

One of the best case studies for local currency is the Brixton Pound. With seven years in circulation, it’s one of the most successful local currencies. The notes are fun and flashy; some depict hometown heroes like David Bowie. With a first-of-its-kind ATM, the B£ cash machine can be found in the Brixton Market. The perfect place for supporting local businesses with local currency and driving a community-based economy!

Almost every business located in the market accepts the B£, which started as a community interest project by a non-profit organization. What’s given this project its longevity is the technology integration thanks to fintech. With over 2000 users, the B£ pay-by-text initiative has helped to keep the currency alive. 

Pay-by-text is a simple, easy-to-use system that negates the need for the Internet. While the notes are in circulation and have made for excellent PR, according to Communications Manager Marta Owczarek, they’re not where the value lies for the local economy. Using the pay-by-text system has encouraged spending in Brixton Pounds. 

Consumers are able to top up their B£ account through bank transfers via their accounts or at dedicated outlets that exchange cash. Owczarek also mentioned that the “Lambeth Council has a payroll scheme for local employees, who can dedicate how many Brixton Pounds they want to receive as part of their monthly salary.” Transacting is as simple as typing out a text message with the purchase amount and sending it to the business’ B£ number. Both the sender and receiver will get a text confirming the transaction and proving the money has been sent. 

How Local Currencies Work in the Financial World

One of the big questions is how local currencies are valued. In the case of the Brixton Pound, it’s linked to the national currency, the Pound Sterling. So, it’s not so much a separate currency as it is a different system of valuing money. The Brixton Pound is about community, a sense of belonging, and celebrating the unique identity of South London. With gentrification increasing the costs of living, local businesses have struggled to keep up. For independent businesses, trading with the B£ has given them courage and hope. 

Owczarek says that the “Brixton Pound was set up by a group of local activists who wanted to do something in response to the financial crisis. Many [local] currencies are about alternative banking or alternative value systems.” 

Local Currencies for Local Economies

The local currency has several benefits for a local economy. For instance, money is able to circulate in a community three times longer, according to The New Economics Foundation, in comparison to the national chain. They also reported that for every pound spent in a local shop, the local economy derives  £1.76 worth of value while only deriving 36p worth of value when spent out of the area. “We’re in touch with lots of other local currency worldwide and in the UK,” says Owczarek. “In the UK, we were the first to launch in an urban area. The ones that were operational before us, like Totnes, Stroud, and Lewes—the initial idea was more about local supply chains, to be able to grow your own food and supply it locally.”

When local currency is used, instead of profits going towards corporations with offshore head offices, by shopping and spending in their area, communities can better re-distribute profit back into the local economy. A barista working in an independent coffee shop could choose to receive a portion of their wages in local currency. They can spend that money buying from community greengrocers rather than chain stores, and the greengrocers can use this money to buy produce from local farmers. 

Local Currencies and Fintech

Stepping outside of the Brixton case study, there is much to be examined in terms of how fintech has been utilized to create and support the formation of local currencies. In a session on Blockchain and Community Economic Development at Boston Blockchain Week in September of last year (2023), Pietro Poretti, Director of Economic Development for the City of Lugano (Switzerland) discussed the LVGA token

In 2020, the City of Lugano launched its own cryptocurrency to boost the local economy. With the LVGA blockchain wallet, citizens can shop at over 400 retailers. Just over 30,000 people have signed up to use the cryptocurrency, which is stabilized by being linked to the Swiss Franc. 

The token is a digital local currency that operates on the 3Achain blockchain network and was created specifically to enhance the local economy. This was especially important in the wake of the pandemic, which forced retailers and consumers to explore online e-commerce. 

To further incentivize consumers, the city implemented a 10% cashback reward in the form of a coin when spent at a participating store. The LVGA is only acceptable within the city and by its retailers, who can then claim Swiss Francs. 

This initiative is a perfect illustration of how fintech can be utilized to boost local economies and strengthen economic resilience through local currencies. These currencies drive consumers to support local businesses, which in turn helps to circulate wealth in the economy. This reduces the leakage of money to multinational corporations; it is the difference between supporting a family-owned coffee shop and supporting Starbucks. When local economies grow, it comes with hometown pride, social cohesion, participation, and increased community engagement. 


The development of local currencies has taken off over the last decade, propelled by economic instability, rising inflation, and the pandemic. Local economies are making a comeback thanks to progressive municipalities that have embraced technology and the principles of community to stimulate local business. 

When citizens are incentivized to use a local currency, they support small businesses, allowing wealth to circulate in communities three times longer and increasing the value of their money. Rather than profits going towards large corporations with offshore bank accounts and minimal tax contributions, the wealth is distributed across the local supply chain. 

The Brixton Pound is a great case study that shows what’s possible when communities come together, with shared values and a mission, underpinned by fintech; local businesses boom, and the local economy flourishes!