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How They Work
The way that the various Time Banks work can differ from place to place, but the idea is based on certain fundamental principles. A Time Bank is usually born from a cooperative of a handful of people (the minimum would be four or five people) who decide to make their time available to members by performing certain services in exchange for time credits that can later be exchanged in turn for services from others.
Debits and credits are registered in actual accounts, and what’s more, each customer, as we can call them, starts from 0 at the beginning, unable to claim either debt or credit, but rather has to make a kind of pledge of what he is willing to do for the other customers, which will go into a list of services available to all customers. Time Banks offer different kinds of services, but mainly the list will consist of housework, childcare, looking after pets, entertainment and cultural exchange.
All services are registered in the accounts of the customer, who then has a certain time within which to repay his debt, (usually six months). Whoever performs a service accumulates credits equal to the time spent doing the task, which can then be cashed for use on any of the services offered by the bank. The exchange therefore is not strictly reciprocal in the sense that whoever does something for one person must then be repaid by that individual, but it is the bank itself that handles the debts, even though in reality most exchanges tend to be a direct interchange of favors.
Another fundamental aspect is the fact that it is interest-free, meaning that neither lenders nor borrowers accrue any interest (active or passive) on their ‘capital’ of time deposited in the bank. They are merely expected to discharge or renegotiate their debts within a certain period.
This kind of commerce works on the basis of a simple trust pact between associate members, the violation of which will lead, obviously, to the ‘sanction’ of exclusion from the group. Observing the trust pact entails certain ‘working’ rules (which obviously differ from those of the market…). The principle seems to be that of limiting the size of a Time Bank. It is difficult to find large groups in which it is possible to establish an enduring trust. Usually people trust a person they know directly and so Time Banks work mostly within the context of small communities like country villages, close-knit city quarters, or within structures whose functions also (but not only) hinge on certain aspects of social service like hospices, hospitals, schools or social centers.
Another rule is only allowing the possibility to barter almost exclusively skills and services, as opposed to goods. Most Time Bank customers exchange time for time. The equation “one hour of my time = one hour of your time” doesn’t seem to function too well when one tries to exchange one of the terms. 1 hour of my time = your thrown-out clothes? There are exceptions, especially in the LETS, but even in the case of time exchanged for goods the following general principle remains valid: to establish the cost of specific goods, the value is still measured in terms of the time necessary to manufacture (or adjust) the product, rather than the monetary value that the goods would have on the open market, dictated by whoever produces or uses the articles in question. Obviously this will restrict the range of goods available for purchase, restricting it to those goods that are produced locally, but clearly this can be seen as a benefit, rather than a limit, to local producers…
(16/06/2006)
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