Time-based currency

Truck system of payment by order of Robert Owen and Benj Woolfield, National Equitable Labour Exchange, July 22nd 1833.

Time-based currency exchanges date back to the early 19th century.

The Cincinnati Time Store (1827-1830) was the first in a series of retail stores created by American individualist anarchist Josiah Warren to test his economic labor theory of value.[1] The experimental store operated from May 18, 1827 until May 1830.[2] The Cincinnati Time Store experiment in use of labor as a medium of exchange antedated similar European efforts by two decades.[3]

The National Equitable Labour Exchange was founded by Robert Owen, a Welsh socialist and labor reformer in London, England, in 1832.[4] It was established in Birmingham, England, before folding in 1834. It issued "Labour Notes" similar to banknotes, denominated in units of 1, 2, 5, 10, 20, 40, and 80 hours. John Gray, a socialist economist, worked with Owen and later with Ricardian Socialists and postulated a National Chamber of Commerce as a central bank issuing a labour currency.[5]

In 1848, the socialist and first self-designated anarchist Pierre-Joseph Proudhon postulated a system of time chits.

Josiah Warren published a book describing labor notes in 1852.[6]

In 1875, Karl Marx wrote of "Labor Certificates" (Arbeitszertifikaten) in his Critique of the Gotha Program of a "certificate from society that [the labourer] has furnished such and such an amount of labour", which can be used to draw "from the social stock of means of consumption as much as costs the same amount of labour."[7]

Edgar S. Cahn coined the term "Time Dollars" in Time Dollars: The New Currency That Enables Americans to Turn Their Hidden Resource-Time-Into Personal Security & Community Renewal, a book co-authored with Jonathan Rowe in 1992.[8] He also went on to trademark the terms "TimeBank" and "Time Credit".[9][10]

Timebanking is a community development tool and works by facilitating the exchange of skills and experience within a community. It aims to build the 'core economy' of family and community by valuing and rewarding the work done in it. The world's first timebank was started in Japan by Teruko Mizushima in 1973[11] with the idea that participants could earn time credits which they could spend any time during their lives. She based her bank on the simple concept that each hour of time given as services to others could earn reciprocal hours of services for the giver at some stage in the future, particularly in old age when they might need it most. In the 1940s, Mizushima had already foreseen the emerging problems of an ageing society such as seen today. In the 1990s the movement took off in the US, with Dr Edgar Cahn pioneering it there, and in the United Kingdom, with Martin Simon from Timebanking UK and David Boyle, who brought in the London-based New Economics Foundation (Nef).

Paul Glover created Ithaca Hours in 1991. Each HOUR was valued at one hour of basic labor or $10.00. Professionals were entitled to charge multiple HOURS per hour, but often reduced their rate in the spirit of equity. Millions of dollars' worth of HOURS were traded among thousands of residents and 500 businesses. Interest-free HOUR loans were made, and HOUR grants given to over 100 community organizations.[12]

According to Edgar S. Cahn, timebanking had its roots in a time when "money for social programs [had] dried up"[13] and no dominant approach to social service in the U.S. was coming up with creative ways to solve the problem. He would later write that "Americans face at least three interlocking sets of problems: growing inequality in access by those at the bottom to the most basic goods and services; increasing social problems stemming from the need to rebuild family, neighborhood and community; and a growing disillusion with public programs designed to address these problems"[14] and that "the crisis in support for efforts to address social problems stems directly from the failure of ... piecemeal efforts to rebuild genuine community."[15] In particular Cahn focused on the top-down attitude prevalent in social services. He believed that one of the major failings of many social service organizations was their unwillingness to enroll the help of those people they were trying to help.[16] He called this a deficit based approach to social service, where organizations view the people they were trying to help only in terms of their needs, as opposed to an asset based approach, which focuses on the contributions towards their communities that everyone can make.[17] He theorized that a system like timebanking could "[rebuild] the infrastructure of trust and caring that can strengthen families and communities."[15] He hoped that the system "would enable individuals and communities to become more self-sufficient, to insulate themselves from the vagaries of politics and to tap the capacity of individuals who were in effect being relegated to the scrap heap and dismissed as freeloaders."[18]

As a philosophy, timebanking, also known as Time Trade[19] is founded upon five principles, known as TimeBanking's Core Values:[20]

• Everyone is an asset
• Some work is beyond a monetary price
• Reciprocity in helping
• Community (via social networks) is necessary
• A respect for all human beings

Ideally, timebanking builds community. TimeBank members sometimes refer to this as a return to simpler times when the community was there for its individuals. An interview at a timebank in the Gorbals neighbourhood of Glasgow revealed the following sentiment:

[the time bank] involves everybody coming together as a community ... the Gorbals has never—not for a long time—had a lot of community spirit. Way back, years ago, it had a lot of community spirit, but now you see that in some areas, people won't even go to the chap next door for a some sugar ... that's what I think the project's doing, trying to bring that back, that community sense ...[21]

In 2017 Nimses offered a concept of a time-based currency Nim.[22] 1 nim = 1 minute of life. The concept was first adopted in Eastern Europe.[23] The concept is based on the idea of universal basic income. Every person is an issuer of nims. For every minute of his/her life he creates 1 nim that can be spent or sent to other person as well as money.

Timebanks have been established in 34 countries, with at least 500 timebanks established in 40 US states and 300 throughout the United Kingdom.[29][30] TimeBanks also have a significant presence in Japan, South Korea, New Zealand, Taiwan, Senegal, Argentina, Israel, Greece, and Spain.[31][32][33] TimeBanks have been used to reduce recidivism rates with diversionary programs for first-time juvenile offenders; facilitate re-entry of for ex-convicts; deliver health care, job training and social services in public housing complexes; facilitate substance abuse recovery; prevent institutionalization of severely disabled children through parental support networks; provide transportation for homebound seniors in rural areas; deliver elder care, community health services and hospice care; and foster women's rights initiatives in Senegal.[34][35][36][37][38][39]

Timebanking is a pattern of reciprocal service exchange that uses units of time as currency. It is an example of a complementary monetary system. A timebank, also known as a service exchange, is a community that practices time banking. The unit of currency, always valued at an hour's worth of any person's labor, used by these groups has various names but is generally known as a time credit in the US and the UK (formerly a time dollar in the US). Timebanking is primarily used to provide incentives and rewards for work such as mentoring children, caring for the elderly, being neighborly—work usually done on a volunteer basis—which a pure market system devalues. Essentially, the "time" one spends providing these types of community services earns "time" that one can spend to receive services.[40] As well as gaining credits, participating individuals, particularly those more used to being recipients in other parts of their lives, can potentially gain confidence, social contact and skills through giving to others. Communities, therefore, use time banking as a tool to forge stronger intra-community connections, a process known as "building social capital". Timebanking had its intellectual genesis in the US in the early 1980s.[41] By 1990, the Robert Wood Johnson Foundation had invested USD 1.2 million to pilot time banking in the context of senior care. Today, 26 countries have active TimeBanks. There are 250 TimeBanks active in the UK[42] and over 276 TimeBanks in the U.S.[43]

The time credit is the fundamental unit of exchange in a timebank, equal to one hour of a person's labor. In traditional timebanks, one hour of one person's time is equal to one hour of another's. Time credits are earned for providing services and spent receiving services. Upon earning a time credit, a person does not need to spend it right away: they can save it indefinitely. However, since the value of a time credit is fixed at one hour, it resists inflation and does not earn interest. In these ways it is intentionally designed to differ from the traditional fiat currency used in most countries.[49] Consequently, it does little good to hoard time credits and, in practice, many timebanks also encourage the donation of excess time credits to a community pool which is then spent for those in need or on community events.

In 2013 TimeRepublik [53] launched the first global Timebank. Its aim is to eliminate geographical limitations of previous timebanks.[54][55] Since 2015 TimeRepublik has been promoting Time Banking within local governments, municipalities, universities, and large companies.[56][57][58][59] In 2017 TimeRepublik won the first prize at the BAI Global Innovation Awards in the Innovation and Human Capital category [60]

The Community Exchange System (CES) is a global network of communities using alternative exchange systems, many of which use timebanks. Timebanks can trade with each other wherever they are, as well as with mutual credit exchanges. The system uses a base 'currency' of one hour, and the conversion rates between the different exchange groups are based on national average hourly wage rates. This allows timebanks to trade with mutual credit exchanges in the same or different countries.

Elderplan was a social HMO which incorporated timebanking as a way to promote active, engaged lifestyles for its older members. Funding for the "social" part of social HMOs has since dried up and much of the program has been cut, but at its height, members were able to pay portions of their premiums in time credits (back then called Time Dollars) instead of hard currency.[61] The idea was to encourage older people to become more engaged in their communities while also to ask for help more often and "[foster] dignity by allowing people to contribute services as well as receive them."[62]

In 2004, Dr. Gill Seyfang published a study in the Community Development Journal about the effects of a timebank located in the Gorbals area of Glasgow, Scotland, "an inner-city estate characterized by high levels of deprivation, poverty, unemployment, poor health and low educational attainment."[63] The Gorbals Timebank is run by a local charity with the intent to combat the social ills that face the region.[63] Seyfang concluded that the timebank was effective at "building community capacity" and "promoting social inclusion."[64] She highlights the timebank's success at "[re-stitching] the social fabric of the Gorbals."[64] by "[boosting] engagement in existing projects and activities" in a variety of projects including a community safety network, a library, a healthy living project, and a theatre.[64] She writes that "the timebank had enabled people to access help they otherwise would have had to do without," help which included home repair, gardening, a funeral, and tuition paid in time credits to a continuing education course.[65]