Local exchange

What is local exchange?

Local exchanges are formal and informal groups of citizens who exchange goods and services. Instead of using conventional money, they declare their own unit of account and use it keep records of transactions on a common ledger. Note that this is unit is sometimes legitimately called a currency though no issuance takes place. These group collaborations create numerous opportunities for tackling social exclusion and poverty and supporting more environmentally aware lifestyles.

These systems offer an excellent way for people to meet each other’s needs and make better use of their resources without money. There are a wide variety of names in use for such local currencies, from “Grain du Sel” to Hours. Unlike cryptotokens or money-bought local voucher currencies, they impose no monetary restrictions on the amount that a community might exchange. As local groups grow then their credits may be accepted by a wider geographical area if they agree exchange rates with other local currencies. The LocalPay Technology Project would make this interoperability a seamless experience, thereby increasing uptake and use.

What can be exchanged

Each person decides what they want to offer the rest of the community. It might range from gardening, childcare, cooking, mending equipment to helping people with building a website or lending a car. People can share the goods they use infrequently, or they can share time by doing work in exchange for what they need such as vegetables, babysitting, or help learning to drive. The use of a local currency means participants do not need to make a direct swap with someone. Instead, they give to one and receive from another. Categories covered typically include:

House & Garden
Education & Language
Health & Wellness
Sports & Leisure
Construction & Repair
Computing & Electronics
Business & Clerical
Care & Companionship
Arts & Culture
Community Activities

Food buying, production and distribution are obvious ways that people can circulate their value locally to assist their area to grow and prosper. Some groups also include local businesses to drive local trade and increase local loyalty and relocalise the supply chain. The LocalPay Tech project would provide the necessary tools, standards, training and support for more local groups to engage small businesses.

Example: Fane County Time Bank

Dane County Timebank in Madison, Wisconsin, USA is situated in disadvantaged community and food desert. Established in 2005, it provides a way for more than 2,000 members to connect and provide services to each other.

For many young people, the changes associated with coming of age can seem daunting, and when combined with the instability that comes with an arrest, it can become unmanageable. Restorative justice systems help youth stay away from a path of repeat offences while introducing positive influences like the TimeBank’s Youth Court Program and the Dane County Community Restorative Courts work toward reshaping the traditional criminal justice model.

These programs allow victims and offenders to interact with one another and help repair the offender’s relationship with the community. In Dane County, the Community Restorative Courts act as an alternative to the judicial system for first-time offenders who are 17 to 25 years old.

Any person between the ages of 12 and 16 who receives a municipal violation may now “opt-in” to the restorative justice courts run by the TimeBank.  If an informal jury of their young peers decides that the youth should offer a useful recompense to the community, then they ask the youth to do community work that is remunerated in the local currency, hours.

The Dane County Time Bank was able to provide systems for free to its members because it uses the free open source software from CommunityForge, one of the founding platforms of the Credit Commons Collective. The proposed LocalPay Technology Project would secure the future of the Dane County Timebank and connect it to other projects in the same community, as well as more than 300 other local exchanges elsewhere. For some testimonies from individuals see here.