I’ve compiled some research on the time exchange concept – seems like a good way to strengthen the community and build real friendships.
What’s a time exchange?
The “community exchange” or “time exchange” or “time bank” concept is one where people exchange services within a community on a volunteer basis (without exchanging money). The hours exchanged are tracked using online software which allows the community to self-monitor and ensure fairness.
Isn’t this just bartering?
Time exchanges differ from bartering in that Amy may provide an hour of service to Bill, but Bill does not need to provide an hour of service directly back to Amy. Instead Bill can perform an hour of service for Chuck. In a time exchange network, people volunteer for each other and the amount of volunteering – the “transactions” – are tracked so the community can be open and ensure the sincerity of the participants.
That sounds great. What’s the catch?
One of the challenges is that setting up a time exchange can be a lot of work. Many communities have created non-profit organizations to help coordinate transactions, recruit members, and maintain software – if the community is large enough, this can be a full time job. Getting software to maintain a time exchange is another hurdle – hosting and setting up software for a time exchange currently means having skills in the software industry or having money to pay organizations for these services. Prices can range from under $100 a year to over $500 a year.
Terms and taxes
To avoid being taxed by the government, time exchange members in the United States should not equate the exchange of a service with a monetary amount. For similar reasons, if a member is allowing another member to use a room in their apartment, this should not be referred to with the term “renting”, but rather as “providing the service of space use”, since “renting” usually refers to the exchange of currency.
In these days of search engines and the web, the term for a new concept can have an impact on how efficiently that concept spreads. Unfortunately, no truly generic, universal term has appeared for the time exchange concept – instead there are several. “Time bank”, “time exchange”, “community exchange”, “community time exchange” all mean a community-based service exchange. So if you are searching the web for info about this concept, including more of these terms will lead to more diverse results. (“Time dollars” is also a helpful term to search against.)
The term “local exchange trade systems” (LETS or LETSystem) refers to a concept related to time exchanges. However, this term is not in common usage among time exchange groups in the United States. LETS (in part) involves the concept of “equivalency” to the national currency, and for tax reasons this may be inappropriate for time exchanges in the US.
TimeBanks USA and “time banks”
Time exchange communities with names that include “Time Bank”, “TimeBank”, and “Timebank” are usually affiliates of TimeBanks USA – one non-profit organization which promotes the concept of time exchanges and which also sells the use of time exchange software. However, the term “time bank” can refer to a broader concept than “TimeBanks USA affiliate”. Many time exchanges are not associated with this non-profit, and they use less expensive open source software to run their exchanges.
Time exchange terms and Google search result amounts
“time exchange” – 517,000
“time bank” – 517,000
“time banks” – 162,000
“community exchange” – 110,000
“time dollars” – 42,000
“community time exchange” – 4,250
“SkillShare” – 46,600 *
“service exchange” – 292,000 *
* These terms more often referred to things outside the time exchange context (based on brief research), however some groups did use these terms in their names.
Links for further research
http://www.opensourcecurrency.org/, https://www.ohloh.net/p/oscurrency – open source software for running a time exchange
http://www.gmlets.u-net.com/design/home.html, http://en.wikipedia.org/wiki/Local_Exchange_Trading_Systems – all about LETS