International Journal of Community Currency Research 15 (2011) D 52-56 52

Introduction
Noney is the infiastiuctuial factoi ensuiing
uivision of the laboui within the community: it
enables exchange of infoimation, eneigy,
seivice anu mateiial between the paiticipants
of the activity tiaue2. It shoulu not iule, but
seive the citizens anu community, so it is an
impoitant pait of the common piopeity. That
means, that the money system, as common
piopeity shoulu seive the coopeiation within
the locally oiganizeu anu natuial oiuei evolveu
community.
Historical background
A small gioup of entiepieneuis in Sopion
(situateu neai the westein boiueis of Bungaiy
with a population of S7 thousanu) ueciueu in
the autumn of 2uu8, to make the local economy
piospei again. They cieateu a complementaiy
cuiiency, calleu Kkfiank (meaning 'blue fianc',
similaily to the name of a famous ieu wine
fiom the iegion).
Befoie that time a wiue theoietical movement
was aiising: in the fiist yeai of the 2uth centuiy
Siklaky tianslateu anu uiffuseu the basic woik
of uesell (uesell, 19u6). The Bungaiian gieen
money movement was piesenteu in uetail by
Noith (Noith, 2uu6, in Bungaiian: 2uu8). Since
then, uue to the economic ciisis, the neeu even
stiengtheneu towaius them, but also the
theoietical basis wiueneu. The spieauing of
Inteinet helpeu the ciiculating of alteinative
iueas, the oiganising of civil confeiences,
piesentations, the intensifying of LETS ciicles
anu last but not least the cieation of two link-
uiiectoiy website on this subject.
Fiom the mainstieam siue also some goou
iueas aiiiveu: banks anu companies in Bungaiy
intiouuce moie anu moie complementaiy
cuiiencies, like bank caius, point collecting
caius, foou anu tiavel voucheis, mobile
payments. These aie technical complementaiy
cuiiencies, which ueciease tiansaction costs,
anuoi specify the use of the money. Compaieu
to these, economical complementaiy
cuiiencies (like Kkfiank anu othei initiatives)
stimulate the economy foi the given iegion
thiough cieation of loans anu incieasing the
ciiculating speeu of money, by linking local
piouuction with local consumption they
contiibute to ielative inuepenuence anu
sustainable uevelopment of the iegion.
Kkfrank to boost the resilience of
locality
Zsuzsanna Eszter Szalay
Covinus University of Budapest Department of Business Economics
zsuzsanna.szalay@uni-corvinus.hu
International
Journal of
Community
Currency
Research
IJCCR
Abstract
A small gioup of entiepieneuis in Sopion (Bungaiy), leu by Tams Peikovtz, ueciueu in
autumn of 2uu8, to make the local economy - which was pieviously famous foi its giape anu
wine - piospei again, anu to unite the economies of the aiea cut into thiee paits, belonging to
thiee uiffeient countiies. Thus they cieateu an Euiopean Coopeiative Society (SCE), that hau
inuiviuuals anu legal entities fiom Bungaiy, Austiia anu Cioatia as membeis, anu the goal of the
Coopeiative was uefineu as to intiouuce anu opeiate a complementaiy cuiiency Kkfiank (blue
fianc, nameu foi a wine vaiiety), to be useu within the iegion. This papei piesents the Euiopean
0nion uiiectives anu iegulations that maue the cieation of Kkfiank possible anu finally it
shows the main chaiacteiistics anu possible fuithei uevelopments of the new cuiiency which
was boin in spiing of 2u1u thiough the fiist official exchange.
www.ijccr.net
International Journal of Community Currency Research 15 (2011) D 52-56 53
The economical conuitions of Sopion (the city
of Kkfiank) aie stiongly connecteu with the
social-economical situation of entiie Bungaiy.
It shoulu be uesciibeu beginning fiom the last
Centuiy: Austio-Bungaiy was a monaichic
union, besiues the joint goveinance in the aieas
of wai, foieign affaiis anu finance, both
countiies kept theii inuepenuence iegaiuing
teiiitoiy anu finance. Following the 1st Woilu
Wai, Bungaiy lost 71.S% of its teiiitoiy, S9.1%
of its total anu S2.2% of its Bungaiian speaking
population. The majoiity of the aiea of
Buigenlanu, which incluueu Sopion as well,
was attacheu to Austiia. The once oiganic
social-economical ielations weie bioken, but
the countiy boiueis iemaineu still peimeable.
Following the 2nu Woilu Wai, in the time of the
iion cuitain, the isolation became complete.
Almost no uevelopment iesouices aiiiveu to
the city close to the boiuei in the time of
socialism.
Buiing the tiansition economy in the yeais
1989-1998, the centially planneu economy
changeu into a fiee maiket economy. The state-
owneu companies weie liquiuateu, theii
activity, foi the most pait, stoppeu. The
Bungaiian economy ueclineu, the numbei of
employeu uecieaseu uiastically anu the impoit
uepenuency incieaseu. These tenuencies uiu
not change since that, but moieovei
stiengtheneu up to piesent times. Local ietail
inuustiy ueclineu, anu multinational chains
staiteu to gain maiket (Szkely, 2u1u). It is to
be emphasizeu that this tiansition economy
was veiy uiffeient fiom a tiansition movement
baseu on peimacultuie, also the consequences
weie veiy contioveisial.
At the enu of the socialism, the citizens of
Sopion cieateu histoiy by oiganising the Pan-
Euiopean Picnic, the initiation of the union of
the ueiman population (Nagy, NA).
The first idea
The iegulatoiy anu maiket enviionment at the
time of the intiouuction of the Kkfiank was
iathei concentiateu anu uepenuent upon
piouucts anu supply coming foim outsiue the
iegion. Fiom 199S companies staiteu to use
the system of (meal anu vacation) voucheis foi
the tiansmission of non-wage allowances. The
thiee Fiench companies, Souexho Pass, Accoi
Seivices, anu the Cheque Bjeunei soon almost
completely coveieu the whole Bungaiian
maiket. The system of voucheis stiengtheneu
fuithei fiom 2uu6, uuiing the economical
iestiiction in the countiy, since this foim of
allowance iesulteu in tax saving foi the
companies. The emitteis tiansfei the value of
the voucheis to the vouchei accepting
companies upon the ieuemption of the
voucheis. Theii piofit comes fiom the fact that
between the uay of emission anu the uay of
ieuemption, they can use the value of the
voucheis as capital iesouice.
The cieatoi of Kkfiank, Tams Peikovtz
unueitook the local tiansmission of allowances
in kinu in 2uu7 as one of the most ienowneu
iestauiant owneis in the city. Be intiouuceu a
hot foou vouchei that coulu be useu in his own
iestauiant anu in othei iestauiants as well anu
latei colu foou, gift, anu school voucheis, as
single-use complementaiy cuiiency unuei the
name of BANI. (The name has uual
connotation, meaning "tasty moisel" anu also
"if we" in Bungaiian.) Be intiouuceu almost
eveiy type of voucheis, that the above
mentioneu Fiench companies intiouuceu, but
his goal was foi his voucheis to be accepteu in
only Bungaiian owneu shops anu iestauiants.
The uiffeient types weie accepteu in 6u-7u
municipalities: of couise they weie most
populai in Sopion, wheie they weie accepteu
in aiounu 18u places. The uensity of the
paiticipating venuois was highei neai the local
maiket, so it is likely that this also helpeu this
maiket to suivive its economical uowntuin.
The BANI voucheis weie anu aie veiy
beneficial both foi the company of Tams
Peikovtz anu foi the vouchei accepting
companies. 0n one siue capital iesouices aie
cieateu, anu on the othei siue the tuinovei is
incieaseu.
The innovation: Kkfrank introduced
by European Cooperative Society
The appeaiance of a new foim of enteipiise,
the Euiopean Coopeiative Society - abbieviateu
as SCE (EC, 2uuS), baseu on the Latin Societas
Coopeiativa Euiopae - was an impoitant
pieiequisite to the intiouuction of the
I
J
C
C
R


K

k
f
r
a
n
k
The appearance of a new form of enterprise,
the European Cooperative Society -
abbreviated as SCE (EC, 2003), based on the
Latin Societas Cooperativa Europae - was an
important prerequisite to the introduction of
the Kkfrank.
International Journal of Community Currency Research 15 (2011) D 52-56 54
I
J
C
C
R


K

k
f
r
a
n
k
Kkfiank. The E0 membei countiies hau to intiouuce this
foim into theii own national legislation befoie 18th
August 2uu6. The aim of the Euiopean Pailiament anu
Council was to piomote cioss-boiuei co-opeiations by
cieating foims of enteipiise that can appeai as one legal
entity in the whole aiea of the 0nion. 0ne of these is the
SCE. (The othei two aie: Euiopean Public Limiteu -
Liability Company, which is Societas Euiopaea, SE, anu
the Euiopean Economic Inteiest uiouping, EEIu.)
The combination of the foim of Coopeiative Society anu
complementaiy cuiiency can seem obvious, because the
Coopeiative Society is a uemociatic institution, wheie the
membeis possess equal voting iights in a tianspaient
way, but its cioss-boiuei vaiiant is by all means a novelty.
The legislation pioceuuie, thiough which the 2uu764
EC Euiopean 0nion uiiective (EC, 2uu7) - Payment
Seivice Biiective was auopteu into the Bungaiian
legislation also suppoiteu the cieation of the Kkfiank.
This legislation is impoitant foi two ieasons:
-
It intiouuceu a new foim of enteipiise, the payment
institution foi the offeiing of payment seivices (0I,
2uu7, pp.9-1S.),
-
It uefineu within the payment seivices the emission
anu acceptance of the payment instiuments that is,
complementaiy cuiiencies, anu the payments by
telecommunication, uigital oi IT uevices (0I, 2uu7, pp.
S6.).
Although the Bungaiian legislation in accoiuance with
the above uesciibeu uiiective came into effect a little latei
than the founuing of the "BA-NI 0sszefogunk If-We
0nite SCE", on the 1st of Novembei 2uu9 (Bungaiian
Pailiament, 2uu9a, 2uu9b), it can be stateu, that the
change was to be expecteu, which helpeu the piocess of
licensing. The SCE coulu not yet execute the payment
seivices on its own, so it hau to ask a financial institution
(Rajka anu Region Cieuit 0nion) to join the SCE as
membei, anu to unueitake this task.
The iegulatoiy anu maiket enviionment hau foui
chaiacteiistics, as follows:
- To opeiate Kkfiank as a complementaiy cuiiency, a
stiong, cioss-boiuei foim of enteipiise, the SCE was
chosen, which maue a ielatively inuepenuent, self-
goveining opeiation possible in accoiuance with the
piinciple of subsiuiaiy appeaiing also in the tieaty of
Lisbon.
- The Kkfiank was built on the paiticipating gioup of
an alieauy opeiating, single-use complementaiy
cuiiency, so-calleu puichase vouchei. Behinu both
weie to be founu the same small gioup of people,
enthusiastic patiiots.
- The Kkfiank is in accoiuance with the
iecommenuation of Robeitson (Robeitson-Bunzl,
2uuS): entiepieneuis of one sub-iegion aie
suppoiting it, but extenuing Robeitson's
iecommenuations a cioss-boiuei iegion is
suppoiting it, which intenus to achieve monetaiy
iefoim on the local level.
- If a community intenus to intiouuce a
complementaiy-community cuiiency
1
in Bungaiy, it
has the possibility to achieve this not thiough a bank,
but thiough a payment institution (by itself oi by
outsouicing).
Some data and facts
Some conciete uata about Kkfiank, as complementaiy
cuiiency anu the SCE suppoiting it:
- The "BA-NI 0sszefogunkIf-We 0nite Limiteu
Liability Euiopean Coopeiative Society" was
founueu by 12S membeis, entiepieneuis anu
inuiviuuals, thiough puichase of S8S shaies, each
woith 1uu Euios. Thus, the SCE was founueu
with S8,Suu euio authoiizeu capital, on the 29th
Novembei 2uu9, the uay of the saint of the city.
- The stiategic paitneis of the SCE aie:
- Rajka anu Region Cieuit 0nion
- Chambei of Commeice anu Inuustiy
- Inuustiy Coipoiation of Sopion anu Its
Enviions
- 0niveisity of West Bungaiy Faculty of
Economics
- CIu Pannonia Insuiance Company
- This list inuicates that the small gioup of
enthusiastic people succeeueu in convincing the
uecision foiming platfoims of the city to suppoit
the initiative.
- To become membei of the SCE, the
iecommenuation of a membei, the puichase of
minimum 1 (maximum 4u) shaies of 1uu Euios
each, the acceptance of the statutes, anu the
appioval of the boaiu of uiiectois of S membeis
is neeueu. (Possessing moie shaies uoes not
iesult in stiongei voting iights.) The membeis
consent to accept anu use Kkfiank as local
cuiiency.
- The main goal of the SCE is to stimulate economy
in Sopion anu its enviions with the help of the
Kkfiank complementaiy cuiiency, in a cioss-
boiuei setting, thiough the enteipiises of its
International Journal of Community Currency Research 15 (2011) D 52-56 55
I
J
C
C
R


K

k
f
r
a
n
k
membeis, encouiaging the puichase of locally
piouuceu goous anu seivices.
- The papei veision of the Kkfiank
complementaiy cuiiency (abbieviateu Kfi) was
piinteu by the Bungaiian Banknote Piinting Ltu.
http:www.penzjegynyomua.huinuex_e.html.
- The fiist official exchange took place on the 7th
Nay, 2u1u.
- The cuiiency (http:kekfiank.huue
utalvany.php) similaily to the foiint, has 6
uiffeient uenominations: SuuKfi, 1uuuKfi,
2uuuKfi, SuuuKfi, 1u uuuKfi anu 2u uuuKfi, but
no coins exist, if these aie neeueu, the foiint can
be useu.
- The Kkfiank note has 7 secuiity featuies,
incluuing wateimaik, inuiviuual seiial numbei
anu ultia-violet colouis.
- Kkfiank is 1uu% backeu by foiint, it can be
acquiieu with foiint (1 Ft=1Kfi) in the bianches
of Rajka anu Region Cieuit 0nion in two locations
in Sopion. The acquiiement is limiteu: only
membeis anu paiticipating venuois may claim
the cuiiency. The paiu-in foiint amount pays
inteiest at the level of the base iate of the Cential
Bank of Bungaiy, foi the benefit of the acquiiei
anu the community. 0nly the fiist ownei of
Kkfiank is entitleu to ieceive inteiest (shaieu
with the community by a iatio 1:4) - one who
ieceives Kkfiank fiom someone else thiough a
tiansaction will not ieceive inteiest.
- The Kkfiank can be ciiculateu fieely, it has no
expiiy.
Since the Kkfiank uoes not pay inteiest, it is foieseeable,
that it will ciiculate fastei than the inteiest-paying foiint.
Accoiuing to the local monetaiy policy iegaiuing this
cuiiency, to pievent the ieuemption of the Kkfiank, 2%
+ vAT ieuemption tax is chaigeu at the act of ieuemption.
Summary: what has been done and future
goals
Kkfiank is a veiy new type of local initiative: theie aie
some specialities, moieovei iaie featuies anu a veiy
innovative chaiacteiistic about this Complementaiy
Cuiiency:
- Kkfiank was cieateu not because of the ieason to
fight poveity, but by a patiiotic community, who
wanteu to ieoiganize the once oiganic social-
economical ielationships.
- It was inspiieu by (anu baseu on the netwoik of) a
system of single use meal anu vacation voucheis, a
foim of non-wage allowances. It means that the
staiting stiuctuie of Kkfiank was final consumei-
oiienteu. If the entiepieneuis buy voucheis foi
Kkfiank, it incieases the ciiculation of Kkfiank.
This is a seconu speciality.
- The local attenuance establisheu a coopeiative to
make theii ielations stiongei. The whole Kkfiank
baseu supply-chain shoulu builu up fiom its
enupoint. It uemanus a veiy active economic-
oiganizei woik. Chains shoulu cieate closeu loops.
This is not new: this is the essence of
coopeiativeness.
- But theie aie only a few cases, wheie the
complementaiy cuiiency belongs to a coopeiative
(WIR in Switzeilanu, RiveiB00RS in 0iegon, 0S), so
this is a iaiity. It is coulu be stateu that small anu
local aie goou, but beautiful only if they can be
bought oi solu with own cuiiency.
- Kkfiank was intiouuceu by a new foim of
enteipiise: Euiopean Coopeiative Society (SCE) This
way Kkfiank unites the aieas sepaiateu by the
countiy-boiuei in economical anu cultuial ways anu
makes the bioken ielationships alive again. It is in
accoiuance with the legislation anu the aims of the
E0. This is a veiy impoitant innovation.
To uevelop this system, suppoit of the local anu national
economic leaueis anu expeits was won, anu the fiist
Bungaiian SCE was founueu to peifoim this task, a long
licensing pioceuuie was accomplisheu, the iush of the
meuia hau to be hanuleu. The patiiots of Sopion iegaiu
the founueis of the Swiss WIR as examples to follow: they
even visiteu them in Basel. Futuie objectives incluue the
intiouuction of electionic, bank caiu payments besiues
papei baseu tiansactions anu the launching of Kkfiank-
loan activity.
The ieal test is coming only now: The membeis of the SCE
have to use the new cuiiency foi theii tiansactions as
intensively as possible, like in a big ball-game: the money-
ball may not fall uown, noi go outsiue by being exchangeu
to foiint. The economic uevelopment concept of the
citizens of Sopion can become ieality only in this way.
Then will become tiue the motto of Kiistof Lacknei,
famous, Euiope-ienowneu long-ago mayoi of Sopion:
"Neigitui non submeigitui", that is "Auiift but not
submeiging".
International Journal of Community Currency Research 15 (2011) D 52-56 56
I
J
C
C
R


K

k
f
r
a
n
k
Acknowledgements
The authoi is thankful foi the help anu encouiagement of Istvn
Nmeth in the piepaiation of this aiticle.
Endnotes

In my opinion, community cuiiency is the iueal foim of

complementaiy cuiiency, assuming that all funuamental neeus
can be met by it.
References
0I0fficial Iouinal of the Euiopean 0nion - Euiopean
Pailiament anu Council Regulation (EC) No 14SS2uuS of 22
Iuly 2uuS on the Statute foi a Euiopean Coopeiative Society
(SCE) http:eui-lex.euiopa.euLex0iiSeivLex0iiSeiv.uo.
uii=0I:L:2uuS:2u7:uuu1:uu24:EN:PBF
0I0fficial Iouinal of the Euiopean 0nion - Euiopean
Pailiament anu Council Biiective 2uu764EC on payment
seivices in the inteinational maiket. (Payment Seivice
Biiective ): http:eui-lex.euiopa.euLex0iiSeiv
Lex0iiSeiv.uo.uii=0I:L:2uu7:S19:uuu1:uuS6:EN:PBF
2uu764EC Biiective of the Euiopean Pailiament anu Council
http:eui-lex.euiopa.euLex0iiSeivLex0iiSeiv.uo.uii=0I:L:
2uu7:S19:uuu1:uuS6:B0:PBF
uesell, Silvio (19u6): The Natuial Economic 0iuei, Beilin.
http:appiopiiate-economics.oigebooksneoneo2.htm,
publisheu in Bungaiian 2uu4.
BA-NI 0sszefogunk If-We 0nite: Kkfiank complementaiy
cuiiency stuuy excuision to Switzeilanu (u1.uS.-uS.uS.2u1u.)
http:kekfiank.huletoltessvajci_tanulmanyut.html.
Koiten, Baviu (2uu9): Agenua foi a New Economy, Beiiett-
Kohlei, 2uu9.
Lietaei, Beinaiu (2uu1): Bie Welt ues uelues. Bas
Afkliungsbuch, Aiena veilag
Nagy, Lszlo (NA): The Pan-Euiopean Picnic anu the opening of
the boiuei 11th of Septembei 1989 , http:www.beilinei-
mauei.uelaszlo-nagylazslonagy-en.htm
Nmeth, Istvn (2uu9): Suiviving in small iegions: Possibilities
of the ,Ant" Coopeiative Society mouel in piesent times http:
www.szoigos.huinuex.php.
option=com_content&view=aiticle&iu=21&Itemiu=2S
Noith, Petei (2uu6): Constiucting Civil Society. - uieen Noney
in Tiansition Bungaiy, Rev. of Int. Pol. Economy, vol. 1S, No. 1,
pp. 28-S2,: http:www.jstoi.oigstablepufplus2S124u6u.puf,
LXIX. law, 2uu6, about Euiopean Coopeiative Societies, Bungaiy
http:www.complex.hukzluattu6uuu69.htm
tu6uuu69.htm#kagy1
LXXXv. Law, 2uu9, about the offeiing of payment seivices,
Bungaiy http:www.pszaf.huuata
cms2u871982uu9_LXXXvtv.puf
LXXXvI. Law, 2uu9, about financial institutions anu financial
seivices
CXII law, 1996. about mouifications to the iegulation about
payment institutions anu payment seivices http:
www.pszaf.huuatacms2u871972uu9_LXXXvItv.puf
Peikovtz, Tams (2u1u): Complementaiy cuiiency anu the
stimulation of local economy (Piesentation given in Sopion on
27th Nay 2u1u) http:kekfiank.huletoltes
peikovatz_tamas_kozgazuasz_klub.html anu http:
kekfiank.huletoltesfizeto_eszkozunk_a_kekfiank.puf
Robeitson, Iames (2uu9): Noney values anu Ethical values.
Cuiing the Nismatch Between Them. In: Laszlo Zsolnai (eu),
Ethical Piospect: Economy, Society, anu Enviionment, Spiingei
Science-Business Neuia Bv, http:www.jamesiobeitson.com
aiticlemoneyvaluesanuethicalvalues.puf
Szalay, Zsuzsanna (2uu8): The Revolution of uentle Noney,
Woiking Papei, B0 ISSN 1786-SuS1, Coivinus 0niveisity of
Buuapest, Institute of Business Economics, http:euok.lib.uni-
coivinus.hu2841Szalay9S.puf
Szkely, Csaba (2u1u): Complementaiy Cuiiency anu the
Stimulation of Local Economy http:kekfiank.huletoltes
Komplementei_penz_es_a_helyi_gazuasag_elenkitese.puf
vaiga, Istvn (2u1u): Naiket Economy without Capitalism
(Piesentation given in Sopion on 19th Ianuaiy 2u1u) http:
kekfiank.huletoltes
vaiga_istvan_piacgazuasag_kapitalizmus_nelkul.html
Websites:
http:www.kekfiank.hu
http:www.complementaiycuiiency.oig
http:www.uea.ac.ukenvijcci
http:www.jamesiobeitson.com
http:alteinativ-gazuasag.lap.hu
http:helyipenz.linkpaik.hu
-