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International finance | 13
Trade Exchange: the Possibilities holders use their card to ‘buy’ other account
The concept of a trade exchange is a good holders' goods and services, the value of
example of an innovative SME. It acts to which is deducted from their account.
provide solutions to the economic downturn When members sell goods and services on
by helping SMEs to help themselves when the exchange, their account is credited with
other forms of credit are unavailable to them. trade pounds allowing members to trade
Bartercard, which was established in Australia and profit from their spare capacity,
during the 1991 recession and dubbed the generate new revenue streams and obviously
‘recession buster’ by the Australian media, is a reduce costs. The peer group business
good example. networking is another important element
A trade exchange enables account-holding along with creative marketing via the
businesses to exchange goods and services network. These can and will be the
with each other, which saves them valuable difference for many companies, determining
cash without having to engage in a direct item how hard they are hit - or not.
or product swap. Bartercard, for example, While the recession inevitably creates new
created a new form of stable currency - the opportunities for a company such as
trade pound - that allows businesses to trade Bartercard through increased sales and the
and grow without the need for cash or credit growth of new members, the firm also
from banks. provides an interest free line of credit to
Bartercard was born in a recession so companies that are subsequently
maybe we are part of the solution. It works bankrupted and fail. In the current climate,
much like a credit card, but is funded by many companies are failing and this is
clients’ own goods and services. On joining, taking its toll on the wider economy. Of
account holders receive their transaction card course a trade exchange is not a recession-
and an interest-free line of credit. They only business tool, as the majority of
receive monthly statements and a Trade Bartercard’s members use the product in the
Directory listing all UK Members with the good times and integrate it as part of their
Directory also available on line. Account long-term strategy.
www.investmentinternational.com July/August 2009 Mortgage Introducer
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