Time banking in the Netherlands
- Hybridization of the time banking concept-
Supervisor:
Prof. René Kemp
Loes Muijsers
ID I6024402
December 17 2014
Internship Assignment
Word count: 8005
Contents
Introduction............................................................................................................................................. 2
Time banking in the UK ........................................................................................................................... 5
Case 1 Timebank.cc ................................................................................................................................. 9
Case 2 Qoin - Makkie ............................................................................................................................. 13
Case 3 Pendo ......................................................................................................................................... 17
Conclusion ............................................................................................................................................. 20
Bibliography........................................................................................................................................... 23
2
Introduction
During my research internship at Maastricht University's International Centre for Integrated
assessment and Sustainable development (ICIS) I have gained practical research experience by
joining the TRANSIT research team from September to December 2014. The TRANSIT-project is
funded by the European Union’s Seventh Framework Programme for research, technological
development and demonstration. It encompasses twelve case study projects, each with two local
initiatives, into a broad range of transformative social innovations (Jørgensen et al., 2014). ICIS is
responsible as a case coordinator for the transnational network of time banks and the local UK time
banks case study.
Time banks provide alternatives to top-down approaches to social service provision in which
people are viewed only in terms of their needs. Time banks focus instead on the contributions
everyone can make to their communities. These often local organizations enroll the people they are
trying to help in reciprocal service exchange arrangements by using time as a unit instead of a
monetary rate. In this model each contribution is equally valued. A time bank member could, for
instance, teach IT-skills for three hours and will subsequently receive three time credits for her
efforts. This member might need someone to work in her garden and could spend her earned credits
on a fellow time banker to help her out.
The time banking movement has grown in prominence in the UK since the foundation of the
first time bank in Gloucestershire in 1998. Furthermore there are networks of time banks in many
countries around the world in Europe, the Americas, and beyond. Surprisingly the phenomenon has
not caught on in the Netherlands; whereas the national time banking organization in the UK
encompasses about three hundred registered local organizations, the Netherlands does not even
count a handful of time banking schemes. For my final internship assignment I have examined time
banking initiatives in the Netherlands. Initially I sought to explain the reason for the lack of time
banks in the Netherlands in comparison to the UK. However this objective turned out to be too
ambitious as I did not have the time and academic background to conduct a socio-economic
comparison between both countries. As a result this paper will explore the nature of the existing
Dutch time banks or social innovations that incorporate time banking elements into their
organization. None of the three Dutch cases fit the UK time bank model; they diverge from the time
banking concept in numerous ways. Therefore I propose that these initiatives should be perceived as
hybrids of the time banking concept.
In order to support this conclusion I will first describe time banking activities in the UK. The
subsequent chapters will present the three Dutch cases followed by an analysis of the nature of the
Dutch initiatives in comparison to the UK time banks. In my conclusion I will reflect on the role of
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theory, comparative analysis and methods of data collection. Additionally I will critically evaluate the
hiatuses of my analysis and make recommendations for further research.
Method
This paper examines three Dutch initiatives that are either labelled as a time bank or incorporate
time banking elements into their organization. The three cases were selected based on the fact that
there are no other similar Dutch organizations to look into. However, it should be noted that there
are long-standing Local Exchange Trading System (LETS) schemes in the Netherlands such as the
Noppes initiative which has been running since 1993. In contrast to time banks, LETS initiatives do
not use time as a unit. Instead, LETS enable members to negotiate their own rates and often include
the exchange of goods in addition to trading services and skills. In order to facilitate trades and
exchanges LETS currencies often bare strong resemblances to the regular currency. Although both
LETS and time banks are local exchange systems, their models do differ from one another in these
respects. For this reason I did not include Dutch LETS systems in my research.
I have interviewed representatives of each of the three selected cases: Ronald Huynen
(treasurer), Sara Pape Garcia (chairperson), Joeri Oudshoorn (secretary) of Timebank.cc, Makkie
project manager Sander de Rijke and Bernd Alexander Kapeller, founder of the online social
exchange platform Pendo. Due to a lack of academic coverage of Dutch time banks and similar social
innovations, my interviews have provided the majority of information for this paper. Additionally,
this paper draws from sources and observations acquired for the TRANSIT-project’s time bank case
study.
4
Time banking in the UK
Time banking was brought to the UK by civil rights lawyer Edgar Cahn, founder of the US Time Dollar
Institute and the time banking movement in the United States. Although it is often stated that Cahn
fathered the idea of time banking in the 1980s, this claim is contestable as it appears that the
concept of time banking had already been developed in Japan (About Timebanking UK; Sarah Bird
interview BBC4).
Fair Shares, located in Gloucestershire, was established as the first time banking scheme in
the UK. The time bank was founded in 1998 by Martin Simon who eventually became the first CEO of
the national network Timebanking UK. During the start-up phase the organization was endorsed by
the American Time Dollar Institute (Time Banks Key, 2000). Additionally, the organization closely
collaborated with the New Economics Foundation (NEF) to set up a national network for time banks
in the UK. For this purpose, the British government’s Active Community Unit (ACU), which aims to
increase the level of voluntary and community involvement in society, awarded Fair Shares and the
NEF a grant of £49,900. The aim of this was to set up a national network in the likes of the US Time
Dollar Institute (Time Banks Key, 2000).
The British government’s instantaneous involvement in the time banking movement is
furthermore highlighted in the Department of Social Security’s statement of June 15 2000 that grants
time banking schemes tax exemption and protects benefits entitlement:
Our legal advice is that time credits derived from participation in a Time Exchange Scheme,
such as Fair Shares, do not constitute earnings for income-related benefit purposes and
therefore participation does not constitute remunerative work. Entitlement to those benefits
would therefore be unaffected (Timebanking UK FAQ).
However, in contrast to the regulations on US time banking schemes, the UK Department of Works
and Pensions (DWP) stated on June 15 2000 that goods cannot be exchanged in time banking
schemes: “It must be emphasized that for the purposes of existing legislation and this guidance, in a
‘Time Exchange’ scheme, Time Credits cannot be exchanged for goods or services or converted into
alternative currency” (Timebanking UK FAQ).
Thus, it follows that the government’s involvement has shaped the organization and
facilitated the growth of time banks in the UK. The development of the time banking movement in
the UK was additionally facilitated by the establishment of the national umbrella organization
Timebanks UK (2001) (later Timebanking UK) and the London Time Bank (2001) which aimed at
setting up time banks across the capital (Cash Alternative finance, 2001; Boyle, 2001). Since the
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foundation of Fair Shares, the number of local time banking initiatives has gradually increased.
Currently Timebanking UK has almost three hundred local member time banks. Furthermore
Timebanking UK is strongly shaped by the values of co-production. The concept of co-production was
coined in the 1970s to examine and explain why development programs often proved to be
unsuccessful. Gradually the concept was expanded to different social issues and in the 1990s the
notion of co-production sought to explain why public and social services often failed at reaching their
objectives. According to co-production proponents Edgar Cahn and British author David Boyle, these
organizations need to establish reciprocal relationships with their beneficiaries and additionally make
use of the community as an alternative economy; the core economy. Alternative currencies and time
banking schemes are perceived as practical tools to enable co-production and combat today’s social
and economic issues (Boyle, 2007). Timebanking UK carries-out the idea of co-production and
embedded these values into their organization and local time banks, as illustrated by the five core
principles of time banking:
Figure 1 The five core principles of time banking (Co-production and time banking)
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While most UK time banks strongly embed these five core principles into their organization, the
nature of the time banks is quite diverse. Generally most time banks are multi-themed; members
exchange a broad range of skills and activities and the organization usually does not have a specific
target group in mind. Single-themed time banks focus on specific member groups and/or exchanges.
Fair Share’s prison project, for instance, provided local prisoners the opportunity to earn time credits
by refurbishing old bicycles and spending their earned credits on taping a DVD for their family or
donating the credits to their relatives, the community or a fellow prisoner (Oppenheimer, 2011).
Specialized time banks, such as the Rushey Green scheme in London, focus on mental health and aim
at improving the health and social well-being of the community. GP’s often refer patients who suffer
from isolation or depression to these specific time banks.
The diversification and evolution of the time banking concept additionally takes shape in the
models of exchanges. Besides the traditional peer-to-peer exchanges, two alternative models have
been gaining momentum: peer-to-agency and agency-to-agency exchanges. During an introduction
session in London, Timebanking UK CEO Sarah Bird urged new members to think about ways of
including all three models in their local organization as all three exchange types contribute to the
degree of success of a time bank (Timebanking UK Training Session). It should be noted, however,
that the involvement of other organizations in exchanges is not entirely unproblematic. At the
Timebanking UK South West Regional network meeting in Taunton many time brokers
(administrators of local time banks) discussed issues in regards to attracting local organizations.
Organizations tend to shy away from the extra administrative work that collaboration with a time
bank involves and are usually not willing to include the time banking model into their own
organization. In spite of these issues there are many time banks that succeeded in partnering up with
local organizations. Fair Shares, for instance, collaborates with several local initiatives and agencies
such as the city farm, a local café and the Police and Crime Commissioner (Timebanking UK South
West Regional network meeting).
The SPICE initiative has creatively altered the concept of time banking by employing it as a
tool to promote active citizenship. This South Wales initiative operates as a peer-to-agency time
bank. Members earn credits by getting actively involved in their community. A wide range of
volunteering work and chores are available for members to earn credits, which can in turn be spend
at local organizations such as the swimming pool or the bowling alley (Ryan-Collins, et al., 2008).
Timebanking UK has raised concerns about the SPICE initiative as exchanging time credits for
entrance tickets and other services that can be translated into a monetary value could be perceived
as creatively bending the DWP’s prohibition on the exchange of goods (Timebanking UK Training
Session). In spite of these concerns, the SPICE twist on the time banking concept has served as an
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example and inspiration for other organizations as will become evident in the Dutch Makkie case.
The UK time banks actively ensure the safeguarding of participants and exchanges by
conducting a background check on each new member. Time brokers typically monitor their
members’ trades and will prevent, interfere and/or mediate risky exchanges such as child-care or
trades involving other vulnerable groups. Timebanking UK offers their members access to insurance
companies that are willing to insure local schemes that are part of the national umbrella
organization. Although most time brokers do their job on a voluntary basis, running a time bank does
in fact cost money. A membership of Timebanking UK provides access to the professional online time
banking software platforms Time Online and Time and Talents. Small community time banks, run by
a volunteer, pay an annual membership fee of £120, while medium time banks with a paid broker
pay twice as much. In addition to the membership fee and insurance costs, most time banks need a
certain amount of petty cash and also pay for expenses related to the IT infrastructure necessary for
running an organization.
To cover such expenses, time banks often apply for funding to a diverse range of
organizations and institutions. Depending on the size and purpose of the time bank, different funding
partners can be attracted for a certain amount of time such as the National Lottery fund or the local
Police and Crime Commissioner. A downside to having to rely on funding is that especially large
institutions are able to make demands of time banks in terms of their organization. Additionally, time
banks often need to show the impacts of their activities in order to attract and/or retain funding.
Monitoring and evaluating impacts is a difficult task for most time banks, as they typically aim to
build a strong, cohesive community and to improve their members’ social well-being. Impacts related
to these goals however, are difficult to measure and quantify. For this reason, Fair Shares conducts
interviews to create case studies which are in turn presented to (potential) funding partners
(Timebanking UK South West Regional network meeting).
In conclusion, time banking is a successful and established phenomenon in the UK. The
number of time banks has been rising since 1998, which was facilitated by the British government’s
early involvement and the foundation of the national time banking network Timebanking UK.
Although the government’s rules and regulations restrict time banks from exchanging goods and
products, more exchange types have been added to the traditional peer-to-peer model. Running a
time bank requires a lot of time and dedication as safe guarding and the acquisition of funding are
quite demanding and time consuming activities for brokers. The following three chapters will present
the Dutch cases by applying, if applicable, the core themes that characterize the UK time banks: the
government’s involvement, regulation, core values, exchange models, safe guarding and funding.
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Case 1 Timebank.cc
In 2011 the international E-flux art project established a new branch of their temporary art exhibition
Time/Bank in the Stroom center for art in The Hague. The E-flux initiative has set up a number of
Time/Banks throughout the world aimed at supporting cultural communities by creating an
alternative micro-economy to facilitate trades between artists. In order to visualize the time banking
aspect a Time/Store was set up as part of the exhibition where artists’ materials were exchanged for
Hour Notes. When the project came to an end in 2013, the volunteers involved in The Hague’s
Time/Store expressed their wish to continue the time bank and aspired to take the initiative to the
next level by developing a fully functioning platform with an effective economic system.
For this purpose the time bank continued to operate independently from E-flux in July 2013
under the name Timebank.cc. During this transition phase the time bank established a
communication group in order to come up with a new identity and slogan for the time bank. As the
previous project had always been intended as a temporary art exhibition, much of the information
and vision of the project was heavily based on creative and poetic values. The new identity, however,
had to appeal and be comprehensive to a broader audience which led to the development of a new
practical mission and statement. The organization did retain one aspect of the art exhibition: English
remained the official language within the organization. While it could be argued that the time bank’s
official language excludes certain potential member groups, the organization’s board members stress
that The Hague has a massive international community and that both foreign and local city residents
often perceive the time bank as a social instrument to meet new people.
Another change made in this phase involves the Time/Store. The Dutch law does not have
any specific regulations on time banking. However, an inspector of taxes paid a visit to the Time/Bank
art project, and did note that the products sold for hours in the Time/Store could be perceived as a
tax dodge. For this reason, the organization does not allow the exchange of products and goods since
the time bank became independent. As the hours earned from time banking activities do not
correlate to an hourly wage in Euros, the credits are not indicated as taxable income. Nor does it
appear to be a problem, or in conflict with the law, that unemployed benefits recipients are active
time bank members.
After the time bank became independent the board members decided to establish their new
organization as an association. Members of the time bank have the opportunity to join the
association by paying a membership contribution in hours. These hours are used in return as
resources to compensate the time the board members spend running the association. The decision
to establish an association instead of a foundation was based on the desire to keep the responsibility
and important decisions within the time banking group. The aim of this measure is twofold: it is
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meant to safeguard the organization but in addition it also protects the time bank from its board
members. This is because the association is able to argue against ideas and has the power to veto the
board’s decisions. The association is legally established but is still in an early phase of development.
Board member Sara Pape Garcia explains that the time bank appears to be in a constant phase of
transition: “It sometimes seems that we are in a transition phase continuously and that we will never
get out of that, especially not with an idea such as the time bank which can never make a full circle as
it always comes to down to experimenting with values” (S. Garcia, personal communication,
November 12 2014).
One of the organization’s most valued principles is their independence from funding and the
Euro in general. Timebank.cc is a bottom-up approach, a citizen initiative, and does not wish to rely
on funders for financial resources, nor does it want to have another organization’s political agenda
imposed on the time bank. For this reason the time bank’s staff is paid in hours and the open-source
banking software Cyclos is used to run the digital time bank system. As it is not completely possible
to operate without any Euros involved, the time bank sometimes gives presentations about their
organization in exchange for a financial compensation.
Timebank.cc draws from the peer-to-peer model and currently has about thirteen hundred
registered members on their website. Due to the international environment however, members
often move away from the area after a period of time and as a result become inactive. 20% of these
registered users have made an exchange according to Treasurer Ronald Huynen. The average
number of transactions for this group is 8.5. Although the time bank does not require members to
provide their age during the registration, the board members agree that the majority of the active
members who attend events are aged between twenty and forty years old. Unlike most UK time
banks, the organization does not conduct background checks, nor are exchanges moderated by staff
members. Additionally the organization does not have a policy restricting risky exchanges such as
babysitting. Such activities are usually not advertised on the website but do take place in a private
setting in which members can earn hours by babysitting for a friend who is also a time bank member.
In this sense, the time bank is not liable for anything that goes wrong during an exchange. The
website does provide a rating feature which allows members to present each other marks after a
successful exchange. However, as the board notes, the majority of the members do not use this
feature as the system is based on trust and inter-connections between members who are acquainted
with one another.
The organization not only diverges from the UK model in terms of safeguarding but also by
the unique credit system it employs. A common credit model used by time banks is the mutual credit
system. Member A taking care of a chore for member B will result in positive balance for A and a
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negative balance for B; summed up, the balance will always equal zero. Additionally, this system
allows members to be indebted. Timebank.cc employs a different and quite unusual credit system.
Hours are created by the time bank and only the bank is allowed to have a negative balance instead
of its members. As the The Hague staff is paid in hours, these are the first hours that are created by
the time bank. For instance, board member Ronald works eight hours a week on the organization’s
website and earns eight credits for his efforts; Ronald gains eight credits while the bank loses eight.
Ronald can then spend these eight hours by finding time bank members to perform tasks for him.
The credits are transferred to the members who work for Ronald and so on. The downside of this
system, however, is that it is impossible to create an infinite amount of hours as this will cause
stagnation. Members saving or storing credits would also harm the system as new hours need to be
created when the current hours are not circulating through the system. Instead, members need to
keep the flow and the dynamics of the system going by actively earning and spending their hours. An
advantage of this approach is that time bank members who fully understand the concept, do realize
that they are responsible for keeping the system running and are generally motivated to do so.
Although the motive of creating responsible and sustainable users is commendable, it could be
questioned whether or not this system is efficient.
Figure 2 Timebank.cc’s credit system illustrated
Currently the speed of the flow of hours is low as new hours are created on a slow pace and
members often experience difficulties in earning and spending hours. This is due to a number of
reasons. First, members often find it difficult to ask for help and to create specific ads to voice their
needs online. Second, some members offer extremely specialized skills that are not in demand by
other members. In order to combat these issues, the organization regularly hosts live sessions.
Inspired by the creative time bank of Leeds, which hosted speed-date sessions, Timebank.cc
developed their own events to facilitate exchanges. Members interview each other during these
events in order to uncover the needs and undiscovered or unadvertised skills of the group. The
session is concluded with a group discussion and many matches are made in the process. Live
11
sessions not only inspire members to come up with new advertisements but also create stronger
bonds of trust within the group once members have had the opportunity to meet in person. For this
purpose the organization also set up other informal social events such as a potluck to enable
members to mingle with one another.
In spite of these efforts to increase the social coherence of the group the time bank does not
aim to grow in a rapid pace and avoids attracting dozens of new members by advertising the time
bank on festivals and other events. The focus is rather on a small group of people, as it takes time to
recognize and get used to time banking as an alternative set of values. As board member Joeri
Oudshoorn explains: “In addition to the Euro, and families taking care of one another, there is
another value (…) and it takes a lot of brain power to understand and deem the hour-for-an-hour
principle as natural” (J. Oudshoorn, personal communication, November 12 2014). This
understanding is necessary for users to understand the dynamics of the organization and
consequently to keep the system going. Additionally, a rapid growth of members would entail the
creation of many new hours, which can be problematic as well as it involves the risk of stagnation.
Although the board does not currently aspire to have a massive member group, the
organization did launch two other branches in Amsterdam and in Lisbon in the past 1.5 years.
However, similar to the growth of members, the organization is careful about broadening the
Timebank.cc and is only interested in setting up new branches in case the local community requires
or demands one. For instance one member of the time bank in The Hague established the Lisbon
time bank a year ago. During her time as an Erasmus student she became enthusiastic about time
banking and upon her return she found out that many people in Lisbon liked the idea as well.
In conclusion, Timebank.cc is a relatively young organization that has been growing and
evolving ever since its establishment as a temporary art exhibition. Although it employs the classic
peer-to-peer exchange system, the time bank is unique in many respects such as the alternative
credit system, the establishment of an association and the desire to work independently from
funding and the Euro in general. Timebank.cc is characterized by an on-going process of learning
from experience which is evident by the changes that the organization has went through in their
transition to become independent from the art project as well as their solutions to practical
problems such as the organization of live events to facilitate the flow of exchanges and currency.
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Case 2 Qoin - Makkie
Qoin is an Amsterdam based social enterprise aimed at developing, implementing and managing
community currencies in the Netherlands and abroad. Community currencies launched by grassroots
movements are often initiated due to a lack of trust in the market economy and conventional banks.
Qoin, in contrast, aims to achieve societal impacts by means of community currencies. For this
purpose the organization established three core themes: social currencies, business currencies and
green currencies. The aspiration to achieve societal impact is further articulated in Qoin’s mission
statement: “We are a young, lively organisation on a mission to change the world’s financial systems
and enrich society in a disruptive way” (Qoin Mission). Qoin project manager Sander de Rijke explains
this disruptive element as the societal impact the organization aims to achieve by implementing the
right type of complementary currency in a certain community.
The Makkie community currency is one of Qoin’s social currency projects. A pilot was
initiated in the Indische Buurt, a neighborhood in the Amsterdam East district, in 2012 and the
project is still running today. Makkie was inspired by the SPICE project and is an amalgamation of
peer-to-agency and peer-to-peer time banking activities. The idea to introduce a social currency in
this specific neighborhood was initiated by the municipality of Amsterdam, Qoin and several local
organizations, as the Indische Buurt is a neighborhood with high unemployment and criminality rates
but also offers chances and opportunities for improvement. After several fruitful meetings with the
Makkasserplein neighborhood committee other stakeholder organizations were approached to get
involved in the pilot. As it turned out, many of these organizations already collaborated with one
another on several projects which facilitated the foundation of the Makkie collaborative alliance. The
Makkie scheme is run by a project team which consists of members of each of the partner
organizations. This team is responsible for the execution, support, IT and marketing of the project
and additionally manages the relationships with the distribution- and redeeming partners.
Although residents of the Indische Buurt are the project’s target group, everyone is free to
join the initiative. The distribution- and redeeming partners, however, are generally located in the
neighborhood. Potential members are attracted by the local organizations involved in the project,
such as housing associations, the Maatschappelijke Ondersteuning Integratie (MOI; Societal Support
Integration) which have their own member groups to reach out to and consequently are aware of
their problems and needs. Currently the organizations counts six hundred registered online
members. The exact amount of members is unknown due to the fact that Makkies are available both
as a digital currency and as paper notes.
As mentioned previously Makkie does not fit the traditional peer-to-peer time bank model. It
rather incorporates this element in addition to peer-to-agency exchanges into one system; a hybrid
13
model which combines features of time banking and loyalty schemes. Similar to traditional time
banks, members can earn and spend credits by making exchanges with other users. The Makkie
website offers the online platform Marktplaats (market place) to facilitate such exchanges. The
project team is neither responsible nor liable for the peer-to-peer exchanges and does not mediate
the transactions. However the team members do keep an eye out on the advertisements and remove
inappropriate content from the page. De Rijke states that the organization does have a couple of
wishes to improve safeguarding. Yet such additions to the system, such as ratings and reviews,
require more investments in order to build the IT infrastructure, which the current budget does not
allow. In addition to this classic peer-to-peer model, members are able to earn credits by getting
actively involved in their community. Distribution partners reward Makkie members with credits for
taking care of chores such as volunteering during the neighborhood’s festival, cleaning playgrounds
and cooking in the local soup kitchen. In return, members are able to exchange their Makkies for
discounts and tickets at local stores or facilities such as the swimming pool, the museum, a hair
dresser and even the Albert Heijn supermarket. This hybrid system allows the organization to achieve
substantial social impact, as illustrated by Sander de Rijke with the following example: “If I
[distributer] hand you one Makkie and you spent it on your neighbor, who will spend it on his
neighbor, and she goes to the swimming pool; I have purchased one time credit and achieved a social
impact three times” (S. de Rijke, personal communication, November 25 2014).
Unlike time bank schemes in the UK and the time bank of The Hague, the Makkie scheme
does provide members access to goods such as free tickets to local venues and discounts at local
shops. As the Euro value of these products varies to a great extent, it is extremely difficult to
calculate the value of one Makkie and as a result it is practically impossible to classify earned credits
as taxable income. The organization deliberately opted for this approach. As De Rijke explains, the
Dutch legislation does not provide any specific regulations regarding time banking activities. Instead,
the LETS regulation is applied to the few Dutch time banks that currently exist. According to the Tax
Authorities, members of LETS schemes may earn up to three thousand LETS credits on an annual
basis without being obliged to declare these credits on their annual tax statement. If a member
crosses this limit, an inspector of taxes will look into the situation to determine whether or not the
member is generating an alternative source of income. Makkie and the Tax Authorities came to an
agreement that members are allowed to work up to 666 hours a year before the Tax Authorities will
invest an individual case; An hour was stated to be equal to the Dutch volunteering compensation of
€4,50 per hour. 3000 divided by €4,50 equals 666 hours. Currently none of the Makkie members
have by any means crossed this border and it is unlikely that this will happen during the course of the
project.
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Distribution partners are preferably venues that have spare capacity to offer. A local movie
theatre, for instance, may have many unfilled seats during certain days or times of the day. Offering
tickets in exchange for Makkies will not put the owner through any additional costs, but may actually
turn out to be profitable as it could potentially attract new customers and yield extra income as
these visitors are likely to spend their money on snacks and beverages. The distribution partner may
arrange certain time and dates for Makkie visitors and ‘buys’ a certain number of Makkies from the
organization. The contract ends as soon as this set number of Makkies is spent at the venue. This
results in the following credit model: If the movie theatre ‘purchases’ twelve hundred Makkies, the
theatre will have a negative balance of twelve hundred and the Makkie organization a positive
balance of twelve hundred. As a result, it will always be a zero-sum-game. Makkie members,
however, cannot have a negative balance as they first need to earn Makkies in order to be able to
spend them.
Figure 3 Makkie’s currency flow. A local theatre ‘purchases’ twelve hundred Makkies. In turn, Makkie hands
five hundred credits to community organization x which rewards its volunteers with Makkies. Volunteer A
earns fifteen credits and asks a member on Marktplaats to paint her walls for five Makkies. She spends the
remaining ten credits at Albert Heijn to receive a discount on her grocery shopping.
Makkie started as a pilot in 2012 and has since been renewed and partially financed by the project
partners. Although the organization evolves on an organic, yet slow pace, De Rijke notes that in order
to take Makkie to the next level a higher budget and a more professional team is required. For
15
instance, the implementation of a revenue model could attract more local store owners -as they are
currently often unwilling to join because of the real costs in Euros involved- which will result in a
larger social impact.
In conclusion Makkie diverges from the classic UK time bank model but closely resembles the
UK SPICE project. The initiative is in fact an amalgamation of both models. This social currency was
specifically designed for the Indische Buurt to encourage social cohesion, community participation
and to improve the residents' overall well-being. Unlike The Hague's time bank, Makkie does provide
its members access to goods and products by allowing them to trade their Makkies for discounts and
entrance tickets at local stores and venues. The project team has made specific agreements with the
Tax Authorities regarding the accumulation of credits. In order to prevent problems regarding taxes,
the team made sure that the value of one Makkie is difficult to establish by ensuring that the Euro
value of the redeeming partners' discounts and tickets greatly varies. The project team does have
many ideas and wishes to improve the initiative, yet a larger budget and more professional team are
necessary to take Makkie to the next level.
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Case 3 Pendo
Pendo is a social exchange service, offering an online platform that allows its users to create and
manage their own trade networks, which are called gultures, to share and exchange services and
inter-trade with other networks. The initiative was founded by Maastricht University's web content
coordinator Bernd Alexander Kapeller in 2012 and the platform was further developed in
collaboration with Maastricht University’s master’s excellence program Premium. Having grown up in
a small town in Austria, Kapeller was amazed to see the booming sharing economy when he moved
to the city. This experience inspired him to set up a similar initiative with one important difference;
the sharing economy often lacks the implementation of the equivalent of money. Pendo, in contrast,
incorporates aspects of the monetary system into its platform. Unlike time banks the Pendo currency
reflects the purchasing power of the network. Kapeller developed the patented Pendo Power
Standard (PPS) which uses EuroStat’s data on the purchasing power of conventional monetary
currencies. Each gulture is assigned a purchasing power standard, which reflects the average hourly
wage of a specific country or region. By applying this to an exchange rate of one Euro equals one
Pendo, the number of Pendo’s correspond to the purchasing power of a specific region. Kapeller
explains this conversion with a clear example:
The reason why in Brussels the coffee costs four Euros something, because the income of
people working in the Brussels area is just higher than say, Sittard, where you get the same
coffee for two Euro something. So and this purchasing power standard, takes it into account
(B. Kapeller, personal communication, November 4 2014).
The implementation of this standard facilitates inter-trading between gultures. A user from
Maastricht could, for instance, exchange skills or services with a member from a gulture in Spain; the
PPS will then convert the number of Pendo’s in accordance to the purchasing power of the region
which results in a fair exchange between the two parties. Similar to most time banks, the sum of
every unit in the system always equals zero.
It should be noted that Pendo cannot be classified as either a time bank or a typical LETS
scheme. Kapeller rather describes the system as a social exchange service that enables users to
create LETS schemes by establishing their own local exchange networks without the necessity of a
third party mediating the transactions. Yet Pendo bares similarities to both time banks and LETS
schemes and can be best understood as a hybrid of both systems. Similar to time banks, members
can exchange a broad range of skills and services within their network. It diverges from the time bank
model in the sense that hours are not used as an exchange unit. Instead members are allowed to
17
determine their own rates. An hour of gardening work, for instance, might be valued differently
within the same gulture. Second, the exchange of goods and products for Pendo’s is also allowed.
Because of the lack of Dutch regulation regarding exchange systems, Kapeller is not worried about
the taxation as the three thousand units LETS rule is applicable to Pendo as well.
Since its foundation in 2012, Pendo has been growing and evolving. In 2013 a group of
Premium students conducted marketing research and performed an exploratory study on the
complementary currency systems, the market and Pendo’s target audience. The platform was further
developed based on these findings. A second group of Premium students assisted Kapeller in
implementing the pilot and as a result the first prototype of the platform went online in February
2014. Currently the platform is still in the beta phase and its development and growth is an ongoing
process. As a result, Pendo does not have many active members at the moment. One of the
challenges Kapeller faces is that it is difficult to explain the value of one Pendo and the PPS as people
even tend take the value of one Euro for granted which complicates comprehending the Pendo
conversion.
Yet market research carried out by Pendo showed that attitudes and social beliefs are strong
indicators of the willingness for people to join initiatives such as Pendo. For instance, people who
have lost faith in the conventional banks and/or believe in the strength of local communities are
more likely to sign up. Additionally, the level of income appears to be a factor as people on a low
income see more added value and benefits in joining the sharing economy. Lastly, the market
research revealed that females are more willing to join such initiatives. These results partially
determine Pendo’s target audience. Pendo is not meant as a substitute for the market economy, but
rather serves a complementary function to our monetary system enabling people to earn a living in
the sharing economy. As Kapeller regards his platform as a lifestyle option rather than a tool to
combat poverty or other social issues, hipsters are a second target group; Pendo blends in with the
rapidly growing an popular collaborative consumption movement in which, often younger
generations, share their cars, homes and time.
The gultures are designed to be run by members without any intermediation from the
organization. Thus, Pendo does not moderate any of the exchanges that take place and is not liable
in case something goes wrong. Since Pendo is run by Kapeller, volunteers and a group of students it is
impossible to have the organization actively moderate the gultures. Such time and staff constraints
do result in the development of unique solutions to the problem of keeping the currency flowing
through the system that many similar initiatives such as time banks experience. In order to stimulate
exchanges, Pendo employs two instruments: levelling and badging. Users gain levels and are
rewarded with badges for achieving certain milestones, such as making ten exchanges. These special
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badges can be displayed on their Pendo- and social media profiles.
While authentification and verification are important aspects to Kapeller, the platform
currently has no verification system. In the future, however, users will be verified based on their
credit cards in order to ensure safe-guarding. The platform does offer a built-in rating system that
allows members to vouch for one another. Additionally, members who set up their own gultures, and
thus become administrators, will be provided with a membership dashboard which allows them to
monitor and manage their members. These functions and future additions to the platform are means
to facilitate trust: “the trust that people have in the platform equals the trust that people can have
among each other” (B. Kapeller, personal communication, November 4 2014).
In conclusion, Pendo is a relatively new initiative and has gone through various consecutive
phases of development and testing which resulted in the launch of the platform's pilot in February
2014. Due to Kapeller's connection with Maastricht University Pendo is strongly shaped by the
research conducted by Kapeller and his team. This science-based aspect is a unique characteristic of
Pendo as other organizations tend to grow and evolve in a more organic manner. Although Pendo is
strictly speaking not a time bank, the platform does provide a new approach to creating local sharing
networks with the added possibility to make exchanges with other gultures as well. It differs from
many alternative currency initiatives in the sense that it does not aim at solving societal problems but
instead aspires to provide members the possibility to earn a living in the sharing economy in addition
to their participation in the conventional economy. As the platform is still in beta, many functions
and features will be implemented in the future such as peer-to-agency exchanges, credit card
verification and a member dashboard for gulture admins.
19
Conclusion
The three cases illustrate that the Dutch initiatives bare similarities to the UK time bank model yet
diverge from it in a number of ways. As stated in the introduction, this paper does not provide a
socio-economic comparison between both countries, however a number of preliminary conclusions
could be drawn from this explorative research project which could in turn be further explored in the
future. A first and notable difference between time banking activities in the UK and the Netherlands
lies in their origins. Time banking was brought to the UK by a core group of front runners who had
already established connections with the American Time Dollar Institute and Edgar Cahn. As a result,
the UK time banks adopted Cahn's principles of co-production as their core values in an early stage of
development. The foundation of a national time banking umbrella organization further shaped the
nature and course of evolvement for time banking activities in the UK. A second and equally
important difference is the government's early involvement in time schemes. The British government
provided funding for the establishment of a national umbrella organization and thus facilitated the
growth of the phenomenon. Additionally the tax exemption and regulations regarding the exchange
of goods both enabled and restricted time banks in their activities and organization.
The situation in the Netherlands, in contrast, is characterized by the lack of strict
governmental involvement, a group of front runners, an umbrella organization and a shared vision or
core principles connected to time banking activities. It is likely that the absence of these conditions
explains why time banking is a relatively recent and not well-established phenomenon in the
Netherlands. On the other hand this also facilitated the diverse nature and origins of the existing
Dutch initiatives. Although the Makkie scheme was inspired by the UK SPICE project, none of the
three Dutch cases fit the typical British time bank model. Moreover, the diverse nature of the Dutch
cases makes it difficult to even compare them to one another as the following table illustrates:
Origins
Timebank.cc
Makkie
Pendo
Temporary art
Collaboration of several
Idea to implement the
exhibition
stakeholders to
equivalent of money in
implement a social
the sharing economy
currency in the Indische
Buurt
Mission/aim
Facilitating exchanges
Encouraging the
Enabling members to
between members by
neighborhood's social
earn a living in the
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Exchange
offering a platform
cohesion, community
sharing economy in
based on mutual trust
participation and
addition to their
and equality
improving the residents'
participation in the
overall well-being
conventional economy
Peer-to-peer
Peer-to-peer. Might be
Agency-to-peer
extended with the
Peer-to-agency
addition of peer-to-
Peer-to-peer
model
agency model in the
future
Regulation
Exchange of skills and
Trading skills and
Exchange of skills,
services; trading goods
services. Exchanging
services and goods.
is prohibited.
currency for discounts
LETS regulation max.
LETS regulation max.
and tickets.
3000 units a year
3000 units a year
LETS regulation in
combination with
volunteer
compensation:
Max. 666 hours a year
Credit system
Alternative credit
Currency flow between
PPS reflects local
system in which only the
distributing and
purchasing power. Sum
bank is allowed to have
redeeming partners,
total always equals zero.
a negative balance.
Makkie, local
organizations and
members. Sum total
always equals zero.
Funding
Independent from
Funded by project
Funding for research
funding
partners
activities
For all the above reasons I would like to suggest to perceive the Dutch initiatives as hybrids of the UK
time banking model. As this conclusion is mainly based on findings from my interviews it would be
interesting to further research this claim by taking the differences of the socio-economic landscape
21
between the UK and the Netherlands into account. A comparative analysis could be beneficial in
order to determine the impact of differences regarding social institutions, the government, social
welfare and economic conditions on the growth and evolution of the time banking phenomenon in
both countries. Additionally, the amount and nature of collected data is insufficient to fully support a
solid conclusion. Due to time constraints I was unable to interview members of the three selected
cases. Therefore the data can only be viewed as representative to a certain extent as it does not
include the users' experience. Adding these experiences would enrich the data as it would allow a
critical evaluation of the organizations' aims and vision from a member's perspective.
Another hiatus of this paper is absence of a theory to analyze the time banking activities in
the Netherlands. During my research internship I have assisted on the TRANSIT UK time bank case
study. One of TRANSIT's aims is to ground and test a middle-range theory on transformative social
innovations by means of in-depth case study work (Jørgensen, et al., 2014). The TRANSIT case studies
are networked initiatives and are characterized by their engagement with transformative discourses
such as the IT-revolution, climate change and the financial crises. As the three Dutch cases are not
part of a network or strongly connected to transformative discourses it was difficult for me to apply
the same theoretical framework to my project, although the UK data collection was guided by this
specific theory which also complicates comparison between both data sets. From this experience I
have learned that the absence of theory is problematic during several stages of a research project. As
I initially planned to employ concepts of TRANSIT's theoretical framework to my own research I
ensured that my interview topic lists covered aspects such as game-changers, systematic change and
transformative discourses. However, during the interviews it became clear that the Dutch cases
diverge greatly from the UK case study and that the selected topics did not yield many findings. Once
the theory turned out to be inapplicable, I had lost my guidelines and experienced difficulties in
ordering my data and drawing a solid conclusion from my sources. Nevertheless, this paper’s
preliminary findings could serve as a first stepping stone for further in-depth research into the Dutch
time banking initiatives. As many of the organizations are relatively new, a second round of
interviews and case studies could further elucidate changes in the evolution and growth of the
organizations as well.
22
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Timebanking UK South West Regional network meeting Taunton. (2014, September 23).
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