Tel Aviv is testing a digital currency that can be used for local businesses with proceeds going to charity. The month-long pilot program started May 5 and will coincide with the Eurovision song contest events taking place in the city."Local currency rewards will be distributed to those making purchases at local businesses, through the Colu app," stated a press release. "Anyone who makes five transactions, each worth NIS 20 or more, will receive 25 coins in digital city currency within the app, worth approximately NIS 25 in total."
If successful, the program will be expanded to public transportation and other areas.
Tel Aviv's Resilience Unit, Business Licensing Division and the Tel Aviv Foundation joined together to create the pilot program.
Hila Oren, CEO of the Tel Aviv Foundation said the project "aims to establish an innovative model which both helps reduce the cost of living, while at the same time making an important contribution to the community. We chose to launch this pilot to coincide with the Eurovision Song Contest, in order to help bring the benefits of such a high-profile international event to hundreds of local businesses, including those not in the city center."
She added that a percentage of the proceeds go towards “Children of Music” a project of the Lev Yafo Youth Center for youth at risk.
The project is part of the 100 Resilient Cities program, which was created in 2013 by the American-based Rockefeller Foundation. “Tel Aviv-Yafo follows Belfast and four other 100RC member cities to formally pilot a local currency model that directly feeds into the city’s priorities for social returns,” said Lina Liakou, Managing Director for Europe and the Middle East at 100 Resilient Cities.
Efrat Makin-Knafo, Tel Aviv's Chief Resilience Officer added, “I believe that every municipality must communicate creatively with city residents, to increase their involvement in city life and make them feel integral to its development. As a member of the 100 Resilient Cities network, we have chosen a local currency as one way to strengthen our urban resilience, which in practice means reducing the cost of living, increasing social responsibility, civic identity and strengthening the local economy. Colu, which calls itself a digital wallet, raised &7 million in January. The Israeli-based start-up operates in four cities and it's app "encourages local payments, while rewarding positive actions with City Currency.," according to their website.