Given that the volume of conventional currency in a local area is scarce by creative design, evidenced by the level of underutilized human and material resources in a given area, complimentary currencies increase the volume of currency in a local area to mobilize these resources. By tying a complementary currency to the national currency when making a purchase, it can be assumed ―and in some cases measured―that the velocity of money in circulation is increased.
2. Increased liquidity in a local area
Complementary currencies are designed to circulate within specific areas and not leave that area for another, and by staying local it works to create more wealth for those in the community. Whereas the national currency drains out of the economy when it is spent at a non-locally owned business, or on goods and services that are sourced from outside of the community, local currencies remain where they are, increasing the liquidity of the currency. The effect of complementary currencies working to keep currency within a specific area longer is called a "multiplier effect".
3. Reduction in fees and interest becomes profit
The money saved by not paying perpetual interest becomes an addition to people's income and their profit. The currency cycles back into the community and everyone benefits.
4. Increased possibility of local import substitution
By encouraging locally-generated business, goods and services that were formerly sourced from outside the locality may be substituted by goods and services produced from within the locality. National and multinational corporations are unlikely to accept complementary currency in payment, due to the impossibility of repatriating profits.
5. Increased employment opportunities
By providing a new market for goods and services, the participants in the system offer what they want, rather than being forced to perform work that they would prefer not to do if they had the choice. As well as discouraging harmful activities simply for currency, local currencies give their participants a safe way of trying out their new employment choices.
6. Increased importance of traditionally undervalued activities
Community members themselves decide the value of such things as childcare, artisan skills or community organizing. In particular, this gives them the opportunity to reassess the value of female dominated work, either undervalued or not valued in the larger market economy.
7. Discouragement of environmentally destructive activities
Without the payment of interest to encourage environmentally destructive activities for its monetary value, there is no incentive to cut down a tree today in order to begin accumulating interest from its sale. Indeed, in some systems where a negative interest rate is used, future units of complementary currency are worth more than those exchanged today. This encourages activities which will facilitate future exchanges, such as planting trees.
8. Increased support for small enterprise development
Rather than relying solely on a high-interest commercial loan, entrepreneurs are able to procure at least part of the goods and services they need for startup simply by making a commitment to supplying the fruits of their labor to the community sometime in the future.
9. Increased strengthening of social relationships
Complementary currencies are designed and intended to help the members of a society to overcome social inequities based on wealth. An intricate social network is reinforced/created as a by-product of members meeting to value and exchange each others' goods and services. In an indirect way, it may be exactly these social benefits which determine economic success over the long run, such as has been shown by the lending circles program and resulting community cohesion.
10. Counter-cyclical economic tendency
According to a study of business inter-trading systems in America, complementary currencies exhibited a tendency to increase during economic downturns, which concludes by supporting the introduction of complementary currencies in areas hit by economic recessions or depression.
11. Money stays local longer, reducing need for external input
The less currency that is flowing out of a local community, the less that needs to flow back into the local community.
12. Multiplier effect from increased circulation
The more currency that stays in a community, the greater the spin off benefits from the circulation of the currency.
13. Using complementary currency saves national currency for non-local purchases
This means increased local capitalization and personal savings, or disposable income.
14. Reduced need to migrant to urban areas in a search for currency
If there is enough income to mobilize local production using local resources to meet local needs, people do not need to leave small communities for the urban city in order to earn currency.
15. Fostering local self-reliance and individual self-esteem
By meeting local needs using local resources, people are active in helping each other. Many people structure their time and value their lives through their work, leading to happiness and increased self-esteem.
16. Decreased gap between the richest and poorest members of a community
When the lower-income people in a community have access to a local means of exchange and possibly increased access to capital, the gap between the richest and poorest members of a community decreases.
17. Access to credit at very low rates
Lowering the barriers to accessing credit means more opportunities for people.
18. Increased access to the local market
By creating a new free market for the exchange of goods and services, participants in complementary currency systems have a new and stable market for the goods and services that they offer.
19. Increased purchasing power at the local level
An increased currency supply means increased purchasing power at the local level.
20. Promote Cash Flow Optimization
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