Currency innovation for sustainable financing of SMEs: context, case study and scalability

Abstract

The purpose of this paper is to introduce the topic of complementary currencies to the academy engaged in research on corporate responsibility and responsible finance, as well as the broader field of progressive management studies. It responds to the growing awareness that both managers and researchers need to address a systemic challenge of our time, concerning stagnating economies and growing inequality. An underlying cause of that problem is identified as mainstream monetary systems and the implications for inadequate financing of SMEs and microenterprises. The potential of currency innovation, from cryptographic currencies like Bitcoin, to local currencies and then to commercial barter and countertrade are discussed. Given the novelty of these phenomena for management studies in general and corporate responsibility in particular, an interdisciplinary literature review is presented. Then a case study of a complementary currency in an informal settlement in Kenya is presented and implications for the wider adoption of useful new currencies discussed. It concludes therefore that SMEs need certain types of complementary currency more than others and proposes that companies can engage in currencies as part of their corporate responsibility programmes as well as for direct business benefit.