Cosmo-Local Credit

= "How a traditional Rotating Savings and Credit Association can evolve into a more dynamic and resilient system by integrating Commitment Pooling". [[1]]

Description

Will Ruddick:

"What if everyday access to resources didn’t need an employer or lending interest at all? What if it were as simple as neighbors and organizations offering what they already do best, tapping a shared line of credit today, and settling up in-kind tomorrow?

That’s the heart of cosmo-local credit. You create a physical or digital voucher (a gift card for your goods or services) and stake it in a community commitment pool. That voucher is your collateral. Against it’s value, you draw what you need now, like money or supplies, without paying interest. Your outstanding obligation is just the value of your vouchers the pool holds. To settle, you can return what you drew and pull your voucher back. Or (and this is the magic) someone else can swap in their own voucher of equal value, take yours out, and spend it with you for your goods or services. In that moment the claim glides from you to them. Later, another neighbor can take their voucher, and so on. Because vouchers can pass hand to hand, the credit simply keeps rotating. It’s salary-like cash flow, but community-backed and recyclable."

(https://willruddick.substack.com/p/salary-without-an-employer)

How To

Will Ruddick:

"The process starts with a borrower application

(1) stating purpose, expected outputs and impacts, repayment period, guarantors, and collateral—usually a digital voucher for the borrower’s own goods or services. If approved

(2), the borrower seeds an initial endowment

(3) of their vouchers into the shared pool. After verification, a credit limit

(4) is granted—typically up to 3× the seed—and the member can swap

(5) their vouchers to withdraw needed resources.

The borrower’s debt equals the value of their own vouchers currently held by the pool; available credit is remaining room in the pool under their credit limit.

...

Obligations can be fulfilled in two ways:

• Option A1: The borrower swaps back the same asset(s) they withdrew, removing their vouchers from the pool."

• Option A2: Another member swaps approved tokens into the pool to remove the borrower’s vouchers (replacing the debt) and then redeems those vouchers directly with the borrower.

After fulfillment, the member submits an Impact Report (A3) for verification; access can be continued or paused based on performance."

(https://grassecon.substack.com/p/cosmo-local-credit-from-the-ground)