When you swipe this card, it keeps our money local

A new mutual credit exchange can stimulate local businesses with local money

WESTMINSTER WEST — We're working to bring to Vermont a community-centered economic system that makes payments through a secure, digital technology - just as debit cards do.

The Vermont BENE Group (Better Economics for Neighbors Everywhere) has been meeting in Brattleboro every week since last winter planning the rCredits system in Vermont.

As a user, you exchange the dollars you deposit into credits that can be used with a special card at participating businesses.

Local spending encourages more local circulation, which stimulates the local economy. The rCard will automatically steer business to local merchants because people will want to use their card at businesses. But the great innovation is that both businesses and individuals receive incentive bonuses (rebates). These are designed to enhance the wealth of the community.

A pilot program has been operating successfully in Greenfield, Mass., for the last two years and now includes 17 participating businesses, including the Green Fields Market food co-op, Foster's Supermarket, popular restaurants such as The People's Pint and Mesa Verde, and more than 150 individual members successfully doing business.

Unlike the current banking system, no fees or charges hide within the rCredits system. Businesses save money because they do not pay the 3-percent fee on every transaction charged by the credit card companies.

Instead of generating corporate profits when bank card fees leave the community, using rCredits actually generates a local “common good” fund controlled and directed by its participating members.

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The rCredits system uses a secure, online accounting system to manage the transactions. Individuals open an account, much like a bank account, and receive a picture ID called an “rCard.”

After loading your account with some rCredits (purchased one-for-one with U.S. Dollars), you can use the rCard like a debit card at participating businesses, or to make payments to other individual rCredits members. The system is accessed online or using a smartphone app, and all the necessary hardware to scan rCards is provided free to participating businesses.

Individuals and businesses can access their accounts online and can monitor the collective community activity quite transparently through various reports accessible to members. Credits can be bought or cashed out for U.S. dollars anytime through the online interface. Incentive bonus credits cannot be cashed out but can be spent within the network.

Using a mutual credit exchange like rCredits is completely legal in the United States, as long as we pay the taxes levied by governments on the transactions, such as sales tax.

Depending on one's tax status, income tax might be due on any income that was received in rCredits.

The success and stability of rCredits in Greenfield since its launch in 2013 has proven the concept and inspired others to create their own local rCredits exchanges.

Ann Arbor, Mich., has recently launched its own rCredits community, and Montpelier has begun the process also.

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Each rCredits community decides democratically, using a consensus-building process, how to use its accumulated common funds.

Only individuals may vote, one vote per individual, regardless of the size of their account. The rCredits philosophy is very committed to the principle that only people can vote - wealth itself does not get to vote.

Some ideas for community-centered investing might include local farm shares, community health care, affordable housing, alternative energy, and other environmental projects. Many other ideas will come from the user community.

As one BENE member said, “We are an apolitical group without an agenda other than to serve a need to address a cash shortage by using rCredits as a medium of exchange.”

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