Plans to construct the first
The proposal means the business will be owned and run by the islanders, but shares can be bought by investors outside the area as well.
Barra is an island with a population of just 1,200 and the community benefit society model means the new firm will be owned by the community, for the community, with any profit made being reinvested back in the community.
The long-term potential benefits include £2m for other local community projects, which would come back to the community through profits made at the distillery in the future.
Peter Brown is the entrepreneur behind the project, along with fellow directors, Neil MacKinnon
They intend to use water from the local reservoir and barley grown on the islands. It will be driven by renewable power from the reservoir, solar power and wind turbines.
Community Shares Scotland (CSS), which advised Barra Distillery, has previous experience of backing a distillery project.