A new bank which aims to encourage more young people to stay in Bridport to live and work, is being backed by a social entrepreneur.

Tim Crabtree - founder of the Bridport Area Development Trust (BADT) and hot school meals firm Local Food Links - is set to speak at a launch event for the bank at the newly-refurbished LSI tonight (THURS) at 7pm.

BADT is behind the LSI project.

The new bank will initially be called South West Mutual and is being supported by the Community Savings Bank Association and the Royal Society for the Arts. Tim has been a Fellow of the RSA for more than 10 years and was keen to support this new initiative.

He said: "I have already been involved in the setting up of a successful financial institution in the region, called the Wessex Reinvestment Trust. This has lent over £8 million to low income householders for home improvements. It has provided support to 40 community land trust housing projects, with 140 houses already built, and it has developed a new financial innovation called community shares."

Now adopted countrywide, these were used by another enterprise set up by Tim called Dorset Community Energy. “We raised £500,000 from local social investors to put solar PV panels on 12 schools and 4 community buildings,” he said.

However, Tim believes that this is not enough and that a regional bank is now needed.

He added: "Loan funds and community shares are vital tools for local economic development, but we need a bank that can take deposits. This is a highly regulated activity and needs significant resources to get started. Recent legislation has made the process a little easier and the support of the RSA has proved to be very important. However, the most important factor will be getting the support of local people.

"A key issue for a town like Bridport is ensuring that there are enough well paid jobs for young people. This requires investment, but the national banks have been shown to be failing small and medium sized businesses. We need a bank that will invest locally and we need local people to provide the finance. A good slogan would be ‘Savings not Suitcases’ – if we don't use our savings to support local businesses, then young people will have to pack their suitcases and leave the town."

Tim believes that in the longer term the creation of a network of local banks across the country could transform the UK's economy.

He is also hoping the new bank can support his current work with Wessex helping communities to develop genuinely affordable housing, with the land held in a community land trust – it could also support local businesses who provide local materials and innovative construction approaches, to create local jobs and more affordable and sustainable homes.