mucr:mutual_credit

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mucr:mutual_credit [2026/03/10 12:41] – external edit 127.0.0.1mucr:mutual_credit [2026/04/20 19:43] (current) – external edit 127.0.0.1
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-# Mutual credit+This topic is part of [[gt:economy|Economy & finance]]. 
 +====== Mutual credit ======
  
  
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-## What is mutual credit?+===== What is mutual credit? =====
  
 It’s a means of trading, of exchange, that doesn’t require conventional money, doesn’t incur interest and doesn’t involve banks. It’s based on networks of businesses, traders and individuals who get to know and trust each other in a geographical area or business sector. Each member gets an account. They go into a directory so that suppliers and customers can find each other. When a purchase is made, the buyer’s account goes into debit, and the seller’s account goes into the same amount of credit. But these are just numbers in an account - information, not money that can be hoarded. There’s a limit to how far you can go into credit or debit – and that’s basically it. It’s a means of trading, of exchange, that doesn’t require conventional money, doesn’t incur interest and doesn’t involve banks. It’s based on networks of businesses, traders and individuals who get to know and trust each other in a geographical area or business sector. Each member gets an account. They go into a directory so that suppliers and customers can find each other. When a purchase is made, the buyer’s account goes into debit, and the seller’s account goes into the same amount of credit. But these are just numbers in an account - information, not money that can be hoarded. There’s a limit to how far you can go into credit or debit – and that’s basically it.
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 </WRAP> </WRAP>
  
-### History+==== History ====
  
 Mutual credit has a fine pedigree. Pre-money, villagers everywhere traded with each other in credit – you help fix my roof, I give you meat when I kill an animal; you help me harvest my crop, I help you bring in firewood – and so on. The accounting was done informally, in people’s heads, and no money changed hands. Mutual credit has a fine pedigree. Pre-money, villagers everywhere traded with each other in credit – you help fix my roof, I give you meat when I kill an animal; you help me harvest my crop, I help you bring in firewood – and so on. The accounting was done informally, in people’s heads, and no money changed hands.
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-## What are the benefits of mutual credit?+===== What are the benefits of mutual credit? =====
  
-### For businesses+==== For businesses ====
  
 - Mutual credit provides a parallel purchasing / accounting system that means businesses don't have to rely entirely on pounds, dollars etc. This insures them against cashflow problems and wider economic downturns. - Mutual credit provides a parallel purchasing / accounting system that means businesses don't have to rely entirely on pounds, dollars etc. This insures them against cashflow problems and wider economic downturns.
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 - Allows businesses to sell surplus stock / spare capacity. - Allows businesses to sell surplus stock / spare capacity.
-### For communities+==== For communities ====
  
 - Unlike conventional money, mutual credit is not an exchange medium that can be sucked out of communities and accumulated in tax havens. - Unlike conventional money, mutual credit is not an exchange medium that can be sucked out of communities and accumulated in tax havens.
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-### Wider benefits+==== Wider benefits ====
  
 - Conventional money is scarce; mutual credit is not – it’s available to any network members who want to trade with each other. To paraphrase Alan Watts: to say that it’s not possible to trade because of a lack of money is like saying that it’s not possible to build a house because of a lack of centimetres. - Conventional money is scarce; mutual credit is not – it’s available to any network members who want to trade with each other. To paraphrase Alan Watts: to say that it’s not possible to trade because of a lack of money is like saying that it’s not possible to build a house because of a lack of centimetres.
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-## What can I do?+===== What can I do? =====
  
 The Covid pandemic provided the stimulus to bring together a group of specialists who have formed [Mutual Credit Services (MCS)](https://mutualcredit.services/) with the aim of setting up mutual credit groups (or ‘clubs’). They realised that lockdowns will mean that many small businesses may close because of lack of money in their communities, and so the ability to trade without money may be exactly the safety net that can help keep them alive. They're approaching existing business networks, social enterprise networks and local authorities. The Covid pandemic provided the stimulus to bring together a group of specialists who have formed [Mutual Credit Services (MCS)](https://mutualcredit.services/) with the aim of setting up mutual credit groups (or ‘clubs’). They realised that lockdowns will mean that many small businesses may close because of lack of money in their communities, and so the ability to trade without money may be exactly the safety net that can help keep them alive. They're approaching existing business networks, social enterprise networks and local authorities.
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-## Further resources+===== Forum ===== 
 + 
 +This topic belongs to the section [[gt:economy|Economy & finance]]. You can ask questions or add information on the corresponding [Forum section](https://forum.growingthecommons.org/t/economy). 
 + 
 +===== Further resources =====
  
 - [International Clearing Union](https://en.wikipedia.org/wiki/International_Clearing_Union) - mutual credit between nations - proposed (unsuccessfully) by John Maynard Keynes at the Bretton Woods meeting in 1944 - [International Clearing Union](https://en.wikipedia.org/wiki/International_Clearing_Union) - mutual credit between nations - proposed (unsuccessfully) by John Maynard Keynes at the Bretton Woods meeting in 1944
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-## Related topics+===== Related topics ===== 
 + 
 +- [Collaborative finance](cofi:collaborative_finance) 
 +- [[crcl:Credit clearing]] 
 +- [[crco:Credit commons]] 
 +- [[comg:Commoning]] 
 +- [[coec:Commons economy]] 
 +- [[comy:Community]] 
 +- [[cryp:Cryptocurrencies]] 
 +- [[lcur:Local currencies]] 
 +- [[rosc:ROSCAs|ROSCAs — rotating savings and credit associations ]] 
 +- [[self:Self-employment]] 
 +- [[smal:Small|Small is beautiful]] 
 +- [[ucos:Use-credit obligations]]
  
  
-## Specialist curators of this topic+===== Specialist curators of this topic =====
  
  
  
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