1 / 21

Regional Capital? Dumfries & Galloway and the Hanseatic Microfinance Initiative

Regional Capital? Dumfries & Galloway and the Hanseatic Microfinance Initiative. Introducing NET Partnership. Nordic Enterprise Trust Link Associates Anne Grethe Eckmann Partnerships Consulting LLP Chris Cook. Nordic Enterprise Trust ( “NET”). Scottish Company Limited by Guarantee

Download Presentation

Regional Capital? Dumfries & Galloway and the Hanseatic Microfinance Initiative

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Regional Capital? Dumfries & Galloway and the Hanseatic Microfinance Initiative

  2. Introducing NET Partnership • Nordic Enterprise Trust • Link Associates • Anne Grethe Eckmann • Partnerships Consulting LLP • Chris Cook

  3. Nordic Enterprise Trust (“NET”) • Scottish Company Limited by Guarantee • Not-for-profit • Charitable status • Aim “To regenerate the historical business and cultural links of the Nordic nations”

  4. Hanseatic Microfinance Initiative • Partnership-based policy development across Baltic/North Sea region • “Guarantee Society” • Local Government Procurement • Mutual Credit • “Capital Partnerships” • Property • Energy

  5. Hanseatic Microfinance Initiative • Hanseatic Microfinance Institution • Trans national network of local initiatives • Programme of Local pilot schemes • Programme of events and publications on and off-line • Norwegian central and local government participation and matched funding

  6. Q. When is a Partnership not a Partnership? • A. When it’s a UK Limited Liability Partnership (“LLP”) • Q. What is it if it’s not a partnership? • A. An “Open” corporate body: with limited liability: and………er, that’s it!

  7. Why an “Open” Corporate? • Open to any “stakeholder” to be a Member, as long as they subscribe to the “Member Agreement” • A legal “wrapper” – like a “trust”, but without the drawbacks - for any assets or revenues anywhere in the world • Tax transparent

  8. The Guarantee Society An LLP with four Members • Local Council • Service Provider (risk management, admin, accounting & IT) • Associations with a “Common Bond” ie geographic (D & G) or functional • Businesses • Individuals

  9. Guarantee Society and Procurement • Local businesses pay proportion of revenues into a “Default Fund” • Local council contracts with Members of GS • In the event of default, dispute or other non-performance Council may call upon Default Fund for compensation

  10. How it Works - Procurement • A awarded £25k contract for Council • Scenario – A falls ill • B completes contract • Council collects any additional cost from GS default pool • Scenario – dispute between A and Council • GS appoints Referee/ arbitrator • Award paid from default pool • GS Members pay provision into Default Pool – possibility of reinsurance or regional pools

  11. Guarantee Society and Mutual Credit • Businesses extend each other interest-free credit • Credit may be settled in cash or barter • No interest, but provision to default fund • Bank or Credit Union as Manager • Council may provide Guarantee for “start-ups” or youth enterprises etc

  12. Guarantee Society – Business to Business Buyers Subscription/ Service Charge £ £ Provision Pool Manager £ Trading and Clearing in £ and £’s worth Default Rebate £ Repayment £ Subscription/ Service Charge Sellers

  13. How it Works • A sells item to B for £1000 - 60 days credit • B pays 1% per month provision into Pool • B pays only £500 on due date • Alternatives • A gives more time to pay • A accepts barter payment of “£500 worth” • A receives £500 from Pool and either • Pool gives extension to B, collecting £500 over agreed period • B pays “Debt to Society” in hours at agreed rate; or • Pool writes debt off • Combination of the above

  14. Guarantee Society – Local Credit • Individuals allocated guarantee limits by Manager (eg Credit Union, Airdrie Savings Bank) • Local businesses extend interest-free credit to local individuals • Individuals pay provision into Default Fund

  15. The Capital Partnership • Trustee/ Custodian Member • Capital User /Occupier Member • Capital Provider/ Investor Member • Manager • Revenues/Production shared • Return OF Capital • Return ON Capital

  16. Capital Partnership Capital Users Capital Rental LLP Trustee Ownership % % Investors Managers

  17. Example- Affordable Housing • Trustee - eg D & G Council • Investor • Land owner invests Value of land • Development financier – option for builder stakeholders to Invest • Long term finance for developed properties • Manager • Occupier – rents the Capital invested in the Land

  18. Example - 1 Mw Wind Turbine Cost £1m = 20k Mw/hrs at £50.00 Mw/hr • 2,500 Mw/hr per year = 50k Mw/hrs over 20 years • ie 40% of production sold to Investors Community “Co-owner” • sell 40% of production at today’s pricefor 25 years • allocate 10/20% of production to Developer/Operator • receives Balance of 40/50% as energy dividend Investors “Co-owners” • buy energy at today’s price valid 20 years: beats gold!

  19. Example – Crichton Campus • Trustee – owns freehold in perpetuity for Community • Occupier • Business • Academic • Investor • Property (Crichton Campus) • Intellectual property (Academic institutions) • Development Capital (“angels”) • Manager (Crichton Campus) • Occupier (Capital user) shares revenues (if any) with Investor and Manager.

  20. Summary • Guarantee Society stimulates local business • through more local procurement • through pool of local credit • Capital Partnerships allow local investment in local productive assets • No requirement for funding from either Treasury or Scottish Executive

  21. Next Steps • Guarantee Society • A micro-business pilot scheme developed in partnership with D&G and FSB? • Pilot Capital Partnerships • Affordable housing scheme/competition using D & G land? • Crichton Campus Business/Academic partnership?

More Related