The Lake District launches its own currency next month as part of an innovative initiative to boost local, independent businesses and generate funds for two vital Cumbrian charities. Reporter Lloyd Bent has been speaking to business people who are embracing the new Lake District Pound - and to others who are sceptical and are not convinced it will be a success.

OPINION appears divided over the imminent introduction of a Lake District pound ahead of the launch of the new currency.

Some small business owners in the national park are giving it their full backing but other entrepreneurs are not convinced it will be a success.

Next month the Lakes Currency Project, an independent, private company run by Ken Royall, who lives near Windermere, will launch a paper currency with themed notes reflecting the culture, landscape and people of the area. The Lake District National Park Authority has invested £30,000 in the project.

Visitors to the area could exchange their sterling for the £1, £5, £10 and £20 currency and keep it as a souvenir or spend it in participating businesses that are locally owned.

However, some business owners believe that signing up for the scheme would be a mistake, criticising the lack of incentive to purchase the unique notes, cashflow difficulties as businesses are required to exchange them and the fact that they have an expiry date.

Tim Hardy, who runs Fitzwilliam Gallery in Hawkshead, said: “To me this seems naive. It seems like a currency is being created that has no longevity.

“Small businesses are being asked to account for all the cash taken in exchange for the new currency.

“Most small businesses struggle to account for themselves, let alone somebody else.

“The currency also loses its value after a year due to the validity date. Investors will keep the money made from any unspent Lake District Pounds that people do not change back to sterling.”

“The exchange rate is one for one, so nobody benefits apart from investors who get any breakage from what is not spent.”

A number of independent businesses have already signed up to The Lakes Currency Project and some post offices in the Lakes will sell the currency.

However, one postmaster, who wished to remain anonymous, explained that his business would not have the cash to exchange for the currency as well as that needed to run the business. “If I get people coming into my post office wanting to change, for example, 500 Lake District Pounds, I’ll be expected to fund that. I don’t have that kind of cash here and I don’t want to do that.”

“I also don’t see why people would change their money for a currency that is one to one. Why would somebody swap normal pounds for another pound that they can only spend in certain places? It seems daft.”

But Robin Love, of Ambleside PO, said: “When I first heard of it I was a bit sceptical. But once I learned more about the people involved and their commitment to it, it made me more confident. The two things I learned is that it doesn’t cost much money and it will hopefully bring more people through the door to spend money on goods. There are items for sale that you can sell alongside the currency to make money and these are available on sale or return. I have seen lots of things come and go and some last a year or so, but I think it’s worth backing this.”

Two Windermere business owners have also spoken favourably of the project.

Ewan Murdock, owner of Just Good Food, in Windermere, said: “It’s very important to us that we buy local ingredients and work with suppliers from the area as much as we can.

“That’s why I love the idea of the Lake District Pound because it’s all about keeping money in the local economy and helping people experience the brilliant businesses we have in Cumbria.”

James Tasker, proprietor of the Lamplighter Dining Rooms in Windermere and a director of the Lakes Hospitality Association, added: “I am overwhelmingly in favour of doing anything that is good for the Lake District and rewards local business owners and helps keep money in the local economy.

“This is especially true in a time when we’re competing with online businesses and multinational companies.”

Project founder Mr Royall said it is a ‘fun way to discover the culture of the Lakes’ as well as supporting local businesses. “First and foremost the Lake District Pound is going to be a fun way for people to discover and enjoy the unique local culture in the Lakes.

“We hope that by encouraging more people to use our local businesses, the Lake District pound will not only strengthen our local economy but add to the region’s sense of identity and pride in itself.

“There are many incentives for people to buy and use these notes. Firstly, they are visually striking, with each note telling the story of different aspects of the character of the Lake District and Cumbria and the region’s heritage, landscape and people.

“Secondly, by using the Lake District currency people will know they are helping support unique local businesses, which we know are the fabric of our communities.”

Mr Royall added that any money taken from Lake District Pounds bought as souvenirs would be donated to the Cumbria Community Foundation and the Lake District Foundation, rather than simply kept by the investors.

A souvenir book telling the story of the notes and the people and places featured on them has been designed to encourage collection.

Lake District Pound outlets would be able to sell these and other merchandise alongside the notes to create revenue, Mr Royall explained.

“We don’t want anyone to have to take home unused Lake District Pounds if they don’t want to,” he said. “However, we do know that our notes will create a very special souvenir.

“If just one per cent of our region’s 18 million visitors chose to collect just one Lake District Pound note as a souvenir, we could create around 150,000 of funds for our two charity partners every year - and make a real difference to the future of the Lake District and Cumbria,” he said. “When Lake District Pounds are sold into circulation via post offices and other outlets, their face value is protected in a Sterling Reserve Account, so that there’s no risk to local businesses who accept the currency. These businesses can deposit their notes at participating post offices, which will transfer the equivalent amount in sterling straight to their bank account.”

The Lakes Currency Project said that Post Office HQ have agreed postmasters can exchange Lake District Pounds and deposit the same amounts in high-street bank accounts as Sterling.

Mr Royall added: “We have additionally put systems in place specifically to make sure that post offices do not run out of cash to exchange for Lake District currency. “People can exchange their Lake District currency back to sterling at any time during their visit to the area.

“If they aren’t able to exchange their notes for sterling before they leave the area they can contact us directly to send us the notes so we can do it electronically.”