It is my belief that the State should issue interest-free, non-debt special notes as grants to stimulate the development of eco-sensitive homesteading, a form of “special Rands”, possibly   called “Ubuntus.” The aim of the Ubuntu would be to stimulate the self-organisation of self-provident communities all across South Africa, and to finance eco-sensitive homesteading in an eco-sensitive way.

The Government could stipulate that it would accept Ubuntu notes in payment of services from and taxes to the State, if it issues them as grants. This would go a long way to making these notes an acceptable means of payment.

This grant money would be used to finance the development of eco-sensitive homesteading throughout South Africa. The money would be granted (not lent) to communities, civil society organisations, and special neighbourhood and settlement micro-businesses.  In other words, the money would be granted directly to those at grassroots.

These grants would generate a reliance on local production. This would stimulate the South African economy at the grassroots level and create a thriving organic network of micro-businesses. New economic motion would start at the “bottom” and not at the “top.”  The rest would follow from that.

Supplementing and expanding such a national-scale financing scheme should be local exchange systems of a money-less accounting or local currency trading type. These formalised local exchange systems should exist to augment, facilitate, and expand even more informal and broader non-measured exchange modes, which are the real lifeblood of community-based, mutual aid interactions. Such schemes will eventually spread across Africa.

The aim of the Ubuntu Finance System is to prevent, or even reverse, the leakage of wealth from the periphery to the core. The legitimation function of the State presents significant disadvantages, unless Ubuntu issuance comes with comprehensive protective legislation to remodel the structural scalability disadvantages of community-based micro-businesses.  Big, established businesses will see the advantage in overtly or covertly bidding for work in Ubuntus as part of a tax management or government relations strategy.  Rapid leakage of Ubuntus from the community would then occur, before they have had a chance to at least cycle several times within and through the community before leaving to remote hands.  Micro-businesses will simply not have the scalability, strength, or logistics to compete effectively with mega-businesses.

If the big supermarket chains readily accept Ubuntus, for example, it may be difficult to keep the neighbourhood baker in business even though her bread is better and more flavourful.  And if these supermarkets can pay their taxes in Ubuntus, and buy services from the government in Ubuntus, there may well be business advantages for them in accepting Ubuntus readily, even as loss leaders.

The Ubuntu Finance System, if it is State initiated, should be protected by a comprehensive legislative package to ensure that its economic liberation goals are met. The Ubuntu Finance System will have to be a parallel system to the Rand system, especially since it is in existence to achieve entirely different social ends and effects.

In such a multiple currency national economy, the Rand system will then find its natural home mostly in large cities, bigger business, and in international transactions with the conventional global monetary order.

The Ubuntu Finance System will thrive where Rands are scarce and will oil the activities of settlements, communities, and interacting networks of collaborating micro-enterprises in a thriving informal economy, which, of course, will not be taxed.  This will be the economy that will make real important aspects of the Freedom Charter.

The most radical approach, which would be a State-less approach, is based on a principle of the complete devolution of purchasing power.  This would yield economic democracy in its purest and most socially advanced form. Devolve the monetary issuing power to the lowest possible level, the level of transacting entities in a particular exchange event.

In such an approach, the Ubuntu General Exchange Facility, which would then be a moneyless transaction recording and accounting service, would be at the level of the neighbourhood with a network of them forming a settlement exchange for the recording and clearing of negotiated transactions between freely consenting parties.  Exchanges between neighbours would be encouraged so transactions could flow regionally. Records from known and trusted Ubuntu General Exchange Facilities could then circulate as money in anonymous and even unrecorded transactions for several cycles of exchange.

The important thing is that no debt or interest is generated and monetary issuance is linked to real transactions initially originating in some sort of community-based dwelling or settlement development effort. In such an informal network economy, micro-businesses could achieve scale as organisms of informal and fluid network ecosystems.

Financing the concept of eco-sensitive homesteading in these Freedom Charter compliant ways in order to make eco-sensitive homesteading real and actual as a long term, unifying, and galvanising national project would present a deep, genuine, and self-sustainable revolution in economic relations in South Africa:  with the same peacefulness, gracefulness, and elegance of the political transformation.

The aim of Government should be to facilitate delivery on the protective policy and large-scale infrastructure level and to provide a nationally recognised and accepted medium of social financing. This is its proper role in informal settlement and rural development.

And if the State will not do this, then communities and civil society should explore ways to partner in order to create the Ubuntu General Exchange Facility, in the form of a moneyless exchange recording and accounting system, as an expression of their freedom rights as encouraged by the South African Freedom Charter.