Frequently Asked Questions
All you ever needed to know about the Bristol Pound, do contact us if you have any further queries
- How will it benefit my business?
i) Advertising your business to the public and other businesses
Recent local currency schemes have successfully raised the profile of member businesses through generating very significant media coverage. After the launch of the Bristol Pound in September 2012, the BBC website received around 250,000 hits and worldwide publicity was generated.
ii) Ease of use for your customers
Paper money is understood by all, and with exciting and innovative art work representing Bristol’s current and historic culture, the paper Bristol Pounds are building awareness and loyalty, driving people to your business. The mobile phone based payment system developed in conjunction with this scheme is revolutionising fast cheap electronic payments and allows access to the scheme for anyone with a mobile phone.
iii) Better communities mean better business
A local currency has the potential to significantly increase the amount of spending power of people in the target area and ensures that the extra spending power goes to local independent businesses. The scheme is helping build stronger relationships with customers and better inter-business trading.
- Why will my customers use the local currency rather than sterling?
In developing this currency we have seen real enthusiasm for it. People want this positive, active way of showing their support for Bristol and its independent traders. It is a great way of being part of the community, and discovering Bristol. It offers a real alternative to sterling, enabling people to support the local economy and get closer to local businesses and suppliers, being much more than just a consumer.
We actively promote all the business members of the Bristol Pound through online and print media.
The printed Bristol Pounds have a strong marketing effect for the independent sector. The mobile phone system represents an exciting and fresh way to pay for goods and services, especially appealing to those who love something new.
- Are there any charges for using the Bristol Pound?
As well as grant funding which has been sourced to develop the scheme, the running costs of the Bristol Pound community interest company will be covered by a small percentage fee on each electronic Bristol Pound transaction, payable by the recipient.
As a not-for-profit company we aim to keep this fee as low as possible. It will initially be set at 2% for receiving sms text payments and 1% for receiving online payments.
We will regularly review the fees to make sure we’re covering the costs of the Scheme and that it’s viable in the long term.
- Will my suppliers accept Bristol Pounds?
At launch there will be a large number of businesses from around the region already signed up and we anticipate that more and more businesses will want to join. The system is one of voluntary membership and complementary to sterling – we do not expect members to trade wholly in Bristol Pounds even with other members of the scheme. However, if your suppliers are not members then we will work with you to encourage them to join, if appropriate, or source alternative suppliers who are members of the scheme.
- What can I do with Bristol Pounds other than pay my suppliers and trade with other Business Members?
Business members that pay business rates to Bristol City Council can pay in Bristol Pounds via Bristol Credit Union.
Bristol Pound also offers a payroll scheme enabling business members to pay a small proportion of wages in Bristol Pounds to willing employees. This is entirely voluntary but we hope business members will encourage employees to get involved in using Bristol Pounds.
- Can I exchange printed or electronic Bristol Pounds back into sterling?
Printed Bristol Pounds can not be exchanged directly for sterling but traders members can pay printed Bristol Pounds into their accounts at Bristol Credit Union or any of the other £B Cash Points.
Bristol Pounds can easily be exchanged for sterling from members Bristol pound accounts at no cost. However we do ask member businesses to make reasonable efforts to spend the money with other members. Keeping Bristol Pounds circulating is the best way to maximise the scheme's benefits. Remember that changing back to sterling increases the amount of money that will leak out of the Bristol area.
- How does taking Bristol Pounds affect my tax liability?
For tax purposes all Bristol Pound transactions are treated as if they were made in sterling. So this will not affect how you declare your revenues, expenses and any taxable profits to HMRC. Likewise VAT should be charged based on the price of goods as normal. On completing VAT returns, payments to HMRC must be made in sterling.
For internal accounting purposes, your online Bristol Pound account will have various transaction reports available which can easily be exported or printed.
- Does my business have to accept full payment in the currency?
In becoming a member, a business is making a firm commitment to accept Bristol Pounds in payment for goods and services. We will work with business members to find effective ways of spending any Bristol Pounds received.
In reality we would never try and force a member to accept full payment in Bristol Pounds against their wishes. Bristol Pounds are not legal tender, but we do ask that businesses honour the spirit of the commitment they have made in working with us to make the Bristol Pound scheme a success.
- Will the paper Bristol Pounds be accepted at a bank?
Business and trader members can pay paper Bristol Pounds into their Bristol Pound account at Bristol Credit Union which has a branch open 5 days a week located in central Bristol, 112/114 Cheltenham Road, Bristol, BS6 5RW, or at Bristol Pound Cash Points.
Paper Bristol Pounds cannot be deposited with other banks.
- How can I join the Bristol Pound?
Click here to register your interest as an individual. We will then contact you with a registration form. Following some identity checks you will receive an email to let you know that your Bristol Pound account is all set up and ready to use.
You will also be able to complete a form in writing and post your application, or take it in to Bristol Credit Union. Your account will be held with Bristol Credit Union of which you will automatically become a member.
- What is local currency?
Local currency can take many forms, but essentially it is money that is used across a particular locality or region. Spending in the target area boosts local economic activity by retaining money in the area. This encourages and strengthens economic ties between the people of the area and local traders.
The Bristol Pound (£B) is a complimentary currency that can be used alone or alongside the national currency. Whilst there are some rules for taking part in the scheme, local currency is not legal tender like sterling and so accepting Bristol Pounds is voluntary.
- How much does it cost to join?
There is no joining fee or ongoing membership fee to be a member of the Bristol Pound at the moment.
- Why are you setting up a local currency?
The primary purpose of the scheme is to strengthen the local economy by incentivising people to use independent local businesses. We believe that the people of Bristol have a strong sense of identity and civic pride. Bristol’s independent businesses are crucial to that community identity.
By incentivising spending in independent businesses, the Bristol Pound helps wealth created in Bristol to stay here. Known as the multiplier effect, Bristol Pounds will be spent repeatedly only within the local economy. With sterling, much of the wealth spent in the city is lost to big international business, related management structures, remote shareholders and the boom-bust of the financial banking system. The Bristol Pound can help deepen and diversify the connections between local business people and all the citizens of the region – an important part of building a sustainable regional economy and providing high quality employment.
- Will the scheme make a profit, and if it does what happens to the money?
The Bristol Pound is run for the benefit of its members and for Bristol, not for profit. The current board proposes that any surplus revenue be distributed to the members in line with their usage of the currency, as well as giving a proportion to community organisations in Bristol.
Because the company is governed in line with a cooperative model, the exact arrangements for profit distribution will be decided by the members at a time when a distribution is possible.
- Why in Bristol?
Bristol is the cultural and economic hub of the South-West. There is a diversity of businesses across many sectors and yet a strong sense of identity and civic pride in the city. In a 2010 survey of Britain, Bristol was ranked as the top city in the UK for quality of life; clearly, many people love living here and have a lot to give to the place where they live. Many aspects of the region’s economy are a product of the people who live here and we think that wealth and well-being created by the people of the region can be better put to use if it re-circulates within the city where it is generated.
- What are the risks?
Electronic Bristol Pound payments and accounts are the responsibility of Bristol Credit Union Ltd, authorised by the Prudential Regulation Authority, and regulated by the Financial Conduct Authority and the Prudential Regulation Authority; firm reference number 213583.
Having and using electronic Bristol Pounds is akin to having normal sterling deposits in any authorised and regulated financial institution.
Each electronic Bristol Pound can be exchanged for a pound sterling with Bristol Credit Union. In the event that the Bristol Pound CIC is wound up and the scheme not continuing, each Bristol Pound in your account will be exchanged for a pound sterling at no charge.
Therefore, the main financial risk is regarding the viability of Bristol Credit Union. It operates a low risk investment policy and plays no part in the speculative secondary markets which led banks into financial difficulties. Deposits held with Bristol Credit Union are protected by the Financial Services Compensation Scheme. This protects up to £85,000 in deposits per eligible depositor. Individuals and most small businesses are eligible depositors – see www.fscs.org.uk for more information.
The printed Bristol Pounds are the sole responsibility of Bristol Pound CIC.
Printed Bristol Pounds are not exchangeable for sterling. They are to be spent with Bristol Pound member businesses which can then pay them into their Bristol Pound accounts. Each printed Bristol Pound in circulation is backed by a pound sterling held in a trust account at Bristol Credit Union (except for those sold as souvenirs) and so in the event of the scheme closing, printed Bristol Pounds will be exchanged for sterling at face value by Bristol Pound CIC.
- Is this being done anywhere else?
There is a long history of places having their own currencies and it was very common in this country until the centralisation of the banking industry in the 19th century. More recently, many places around the world, including the UK, have launched local currencies using a variety of models. Examples include Brixton, Totnes, Lewes and Stroud. It is the first scheme at a city-wide scale.
But the Bristol Pound is innovative in using an easy and fast electronic payment system and in the partnership arrangement with Bristol Credit Union that offers the security of an authorised deposit-taking institution.
- What do you do with all the sterling people pay to get their Bristol Pounds? Will it be safe?
All sterling which we receive in exchange for Bristol Pounds will be held by the Bristol Credit Union in a trust account as backing for the currency and to provide certainty of value to Bristol Pounds. It will not be used to fund the activities of Bristol Pound CIC. Credit Unions are authorised and regulated at a national level by the Financial Conduct Authority & Prudential Regulation Authority.
This arrangement will strengthen Bristol Credit Union which has a clear social purpose to be a community anchor for the city, providing fair financial services for all the people of Bristol, and offering competitive, viable alternative financial provision for member benefit and not for private profit.
- Is it like a LETS scheme?
LETS (Local Exchange Trading Scheme) is a different type of local exchange model which is not exchangeable for Sterling, http://en.wikipedia.org/wiki/LETS.
- What do you do to prevent fraud?
All of the denominated official Bristol Pounds incorporate a raft of the latest security features that make printing fraudulent notes very difficult and expensive. The number of notes in circulation is also monitored and regularly tested for authenticity.
Attempts at fraudulent electronic transactions can be easily traced as these transactions are only possible between members through accounts managed by Bristol Credit Union. If a member’s mobile phone is lost or stolen, their Bristol Pound account can be frozen very quickly.
- Can Bristol Pounds be spent outside the city?
While the scheme is clearly designed for use in Bristol there is nothing to stop people from further afield using and accepting the paper currency. To become a member and use the electronic system you need to live, work, volunteer or go to school/university in any of the four local authority areas which make up the former Avon county (Bristol, Bath & North East Somerset, North Somerset and South Gloucestershire).
- How do I leave the scheme if I no longer want to be involved?
Individual members can stop their membership by simply telling us in writing to close their account. Any remaining Bristol Pounds in your account can be issued to you in local currency notes at the Bristol Credit Union or can be exchanged into your sterling Bristol Credit Union share account at no cost.
We ask business members to give two months notice in order to provide us with the opportunity to update online and print marketing material.