Bangla-Pesa is a non-profit program to strengthen and stabilize the economy of the informal settlement of Bangladesh, Kenya by organizing its more than 200 small scale businesses into a Bangladesh Business Network (BBN) (a Koru-Kenya Working Group) through which its members can utilize a complementary currency to mediate trades. The Bangla-Pesa is a unit of credit within this mutual-credit-clearing (or multilateral reciprocal exchange) system which provides a means of payment that is complementary to official money.
As such, it helps to stabilize the community in the face of monetary volatility by allowing Network members to trade with each other without using the national currency. The local availability of credit also provides the community with a stimulus to local business incubation and social service projects. Koru has worked with the BBN on planning and baseline and survey data-gathering since November 2012. The BBN launched the Bangla-Pesa currency in May 2013. Credits are issued in the form of paper-vouchers that can pass from hand to hand as payment for goods and services. These vouchers are not meant to replace or be legal tender in any way.
Credit Clearing System (Multilateral Reciprocal Exchange)
Once accepted into the Network through a process of finding four guarantors, each business is allocated Bangla-Pesa free of charge. The businesses also pay a membership fee to the network in Bangla-Pesa, which is used for administration, marketing and community programs such as health care for elderly. By using the Bangla-Pesa to buy goods and services at fellow BBN member businesses, they also accept to sell their own goods and services for Bangla-Pesa. The amount of Bangla-Pesa in circulation is determined by the membership and targeted using baseline data, at an amount usable for daily transactions. This currency forms a buffer against fluctuations in the money supply due to remittances, weather, holidays, sending children to school, political turmoil and so on. The fundamental driver of this economic stability and increase in trade is due to the BBN member’s ability to trade their excess capacity. For instance a bicycle operator may have the capacity for 20 customers, but in general only has 10. Now he can give rides to those businesses in exchange for goods and services they have in excess, such as a woman who has extra tomatoes to sell. This increases the overall efficiency of the market and helps the community weather poor economic periods.
The BBN membership consists of 75% women businesses owners who regularly fall below the international poverty line. Generally they work several jobs and find no way to save money from month to month. They are also often sending any spare money back to extended family living in rural areas. The Bangla-Pesa gives them a way to save their national currency and use the local currency for daily spending. Businesses include services such as: clothes washing, tailoring, cobblering, manual laborer, house builders, salons, mechanical and electronic repairs, and porting. Other businesses include: Water, transportation, hardware, soap, general shops, food services, raw food (Including fish, meat, eggs, vegetables, fruits and grains), farming, charcoal, lamp oil, education (Primary and nursery school), clothes, medical clinics, drinks (including alcohol, soda and fruit drinks).
Bangla Business Network (BBN) Organization
The BBN has a board of directors consisting of representatives from: youths, elders, women business owners, men business owners and community health workers. These directors have the task of accounting, administration, registration, Networking, care taking and organizing community service work. In order to join the BBN local business must have 4 other local businesses as guarantors in case of default. Thereby if a BBN member spends their credits at other stores and then refuses to accept a minimal level of Banglas in their own store, the guarantors must resolve the issue, accept those credits at their own businesses or loose membership. This occurrence is minimized with good networking and communication among members. Koru-Kenya holds a non-voting advisory role on the board.
The Bangla artwork was done by Karol Opondo. Born in 1979, Karol Opondo is the Head of Art Department at The Mombasa Academy, Kenya. Karol finds that the communities around her are her greatest inspiration. The security printing and graphic design for Bangla-Pesa was done by the Punchlines Security team in Nairobi under the artistic direction of Saul Nassilah.