Science Fair Project Encyclopedia
Local Exchange Trading Systems
Local Exchange Trading Systems (LETS) are local, non-profit exchange networks in which all kinds of goods and services can be traded without the need for money. A LETS network uses an interest-free local credit or currency so direct swaps do not need to be made. A LETS member may earn local credit by doing childcare or computer work for one person, and spend it later on food, hiring equipment, plumbing, or carpentry with another person on the same network. A LETS is sometimes also referred to as a mutual credit system.
LETS can help a wide cross-section of the community -- individuals, small businesses, local services and voluntary groups -- to save money and resources and extend their purchasing power. Other benefits include social contact, health care, tuition and training, support for local enterprise and new businesses, and a revitalised community.
One goal of this approach is to stimulate the economies of economically depressed towns that have goods and services, but little official currency: the LETS scheme does not require outside sources of income as stimulus.
An estimated 20,000 people are now trading in over 400 LETS networks in cities, towns, and rural communities in the UK, everywhere from Cornwall to Skye, or Western Ireland to Kent. LETS currencies have their own names, and often reflect local distinctiveness: Readies in Reading, Locks in Camden Town, Groats in Stirling, New Berries in Newbury, Berkshire, Piers in Southend-on-Sea.
The basics of LETS
- Local people set up a club to trade between themselves, keeping their own record of accounts.
- A directory of members' offers and requests--goods, services or items for hire, priced in local LETS units--is compiled and circulated.
- Members use the directory to contact one another whenever they wish. They pay for any service or goods by writing a LETS cheque or credit note for an agreed amount of LETS units, or by exchanging printed LETS notes.
- If applicable, the credit note is sent to the LETS book-keeper who adjusts both members' accounts accordingly.
Unlike direct barter, with LETS members can earn credits from any member and spend them with anyone else on the scheme.
LETS in the world
Japan: The Peanuts system in Chiba City. Approximately ten percent of all payments made at local stores are in the community currency (2002).
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