Develop a mobile phone m-banking application aimed enabling the creation of community based complementary currencies. Using open-source software, FrontlineSMS, the application would operate in much the same way as Wizzit and mPesa.
Central Idea
Develop a mobile phone m-banking application aimed enabling the creation of community based complementary currencies. Using open-source software, FrontlineSMS, the application would operate in much the same way as Wizzit and mPesa.
Stage One
Develop the software application. The application will be built on the FrontlineSMS software and modeled around the existing m-banking interfaces such as Wizzit (http://www.wizzit.co.za) and mPesa (http://tinyurl.com/6es5q8)
Stage Two
Create a complementary currency in a poor community, urban or rural, in South Africa using the mobile application.
A complementary currency is a currency that operates in conjunction with the national currency it does not replace the national currency, rather they merely create additional opportunities for the real economy to operate in times of greatly reduced credit and financial liquidity (for example poor communities with under-employment)
The idea, implementation and value of a creating a community based complementary currency are well documented. There are over 1,900 community-based currencies around the world. Examples include Ithaca Dollars (http://www.ithacahours.org), Time Banks (http://www.timebanks.org) and the lesser known but extremely successful WIR (http://en.wikipedia.org/wiki/WIR_Bank) based in Switzerland, and by Bernard Lietaer (http://lietaer.com).
All of these examples showed some sort of positive economic impact – creating jobs and keeping businesses open and communities viable. However, there have been very few efforts at creating these sorts of currencies as a potential economic development tool.
A complementary currency based in a community creates the opportunity for the community to actually create their own means of exchange. This is very different from trying to bring money from the outside into the community.
This approach offers a novel development idea and utilizes a very ubiquitous technology to drive the implementation.
In South Africa we will work with the help of organizations like: Community Exchange Systems, Transition Towns South Africa - both of these are part of global networks of people that work with communities to help them in the process.
In addition we have been in conversation with many experts in the arena: Bernard Lietaer, Arthur Brock, Eric-Harris Braun, and many others.
The mobile application that is created will be open-source and open to use throughout the world. The final result being an increased ability for local communities to solve their own issues of liquidity and economic development without having to rely on donors or micro-finance options.
Complementary Currencies do not charge interest!!
Saul Wainwright – extensive research into economic development, finance and economic theory, and of course complementary currencies. Saul is also a native South African and holds a degree with honors, from UC Berkeley in Political Economics. Saul was awarded a Haas Scholars Award to fund research into South African Investments in the rest of Africa. He also co-organized the BarcampAfrica at Google in October 2008. He will be leaving for SA in January to start a MA in Philosophy, Politics and Economics
Ken Banks – founder of Kiwanja.net and has over 22 years in the ICT world. Helped create FrontlineSMS, NGOMobile and more. He has received large grants for his work from the Hewllet Packard Foundation, McArthur Foundation and the Open Society Foundation.
Julian Gordon – with over 30 years of experience in the IT world he brings invaluable technical skills to the group. He has also worked on several mobile phone applications. He lived and worked in Silicon Valley through the 90's participating in many startups and large companies. He is currently in SA and will provide extensive technical expertise.
The need to develop the actual interface of the currency will require technical knowldege. Using FrontlineSMS and the assistance of Ken Banks will greatly assist. Additional expertise will be needed.
Identifying the community and implementing the complementary currency will be a major challenge. Saul will lead on this but additional assistance will be needed. There are several complementary currencies in existence in SA with great support networks and people willing to assist in the implementation.
There will be a need for a set of people who are very informed on creating complementary currencies. We have already made connections in this area with existing organizations in SA and globally. These include Transition Towns SA, Community Exchange Systems in SA, Arthur Brock, Eric Harris Braun, Bernard Lietaer and many others throughout the community. This network will be heavily tapped during the process of the actual creation of the currency.
The goal is to create a free platform based on open-source technologies. The goal of a community currency is to be self-sustaining.
So beyond the cost of research and development and then the start-up costs associated with facilitating and implementing the currency there should be no other ongoing expenses.
The possibility that a suitable community is hard to identify.
The acceptance of the currency.
Funding the entire project from start to finish.
1) Creation of a viable mobile phone application
2) Identifying community
3) Creating and implementing the community based currency
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Comments
Cc software - SMS
Hello,
I working for the NGO Stro www.strohalm.net and responsible for the open source community software www.cyclos.org.
The Cyclos project has been started in 2003 and the software used world wide by many organisations and communities. There are currently working nine developers full time on the software. We are developing a SMS controller/gateway that will be ready around July 2009. The software will allow SMS payments and other operations like notifications and account information retrieval. The operations can be Mobile-to-mobile and Web-to-mobile. The SMS controler software is standalone and can attend multiple instances (communities). It is possible to have local drivers (software connected to the local SIM/phone number) that can connect over webservices to the SMS controler in order to save SMS costs. All communication can be handled over secure web services what means that Cyclos - SMS controler and local drivers do not need to be necessary at the same location (but can be).
I would like to come in contact with an organisation that is interesting in contributing to the development and running a pilot with Cyclos and the SMS module.
Regards, Hugo van der Zee
ccsoftware@strohalm.nl
Now is the Time for Complementary Currencies
If ever there was a time for a complementary currency, NOW is the time. Complementary currencies were first experimented with during the Great Depression and achieved amazing results. Perhaps because of that, existing interests (banks) prevented them from being used on a greater scale.
In the last 10-15 years, many new experiments have demonstrated the viability and usefulness of complementary currencies. http://transaction.net/money/comp/ provides some good examples and further demonstration of their usefulness.
This project would make it much easier for other communities to start their own currencies. Durango, Colorado, USA is currently dveloping a Bartering network while another group of Independent businesses looking at ways that a local currency could unite both groups.
Tom
Complementary Currency
This is a project that has broader and significant possibilities Perhaps the time has come to explore expanding the concept of Complementary Currency to become a Global Development Complementary Currency, which could be used perhaps to overcome in some cases poor national monetary policies ( e.g. Zimbawe)?
Joe
This Application Can Help Build Healthy Real Communities
Complimentary demurrage-based currencies can help build healthy communities.
Complimentary currencies are proven to reduce unemployment, increase community income, and increase investment in public works - stable exchange media designed for community service
Applications developed for this project could be applicable globally (as local, regional, and sectoral currencies). A 'rusting' fee encourages currency holders to find beneficial ways to circulate the currency locally, multiplying community benefits.
This project is one promising approach to to addressing the challenge of how to implement beneficial complimentary currencies while limiting the potential for fraud.
For more info about why, see Margrit Kennedy's website, with essential articles including 'Why do we Need Monetary Innovation', and 'Financial Stability A Case for Complementary Currencies' , http://www.margritkennedy.de/index.php?modus=PRE&inc=UEB&lang=EN . Margrit clearly describes widespread monetary misconceptions and several proven solutions.
mobile currency
With the financial world in turmoil this is a very timely project to develop a complementary currency on mobile. Where ever the project focuses for its initial dev elopment it will be probably be able to be used anywhere the world.
No one knows where banks will collapse next and a mobile exchange within the control of a local community with the need to print secure paper could make a huge difference in a comunity.
Thanks Mike
Hey Mike,
Thanks for commenting. Yeah, the goal is for this project to be completely replicable and scalable. I see the application being used all over the world - and certainly creates opportunities for local communities to create their own viable currencies in times of economic dislocation.