NB, this page is still under construction

The term LETS is used to refer to a zero-sum, interest-free, mutual-commitment/-credit community currency system.

LETS is often used as an acronym for Local Exchange Trading System or Local Energy Transfer System.

• The essential characteristics of the original LETS model (presented to TOES are described in the LETSystem Design Manual, and include the requirement of metrical equivalence to the fiat money in use locally. It also requires an understanding from each user that a payment in this local currency represents both a record of an exchange agreed by two parties and an an unenforceable undertaking to contribute services or goods agreed to be of comparable value back to the network/community of users. This is the interpretation of LETS and LETSystem on which the broader concept of open money is built. Because the model was propagated widely but incompletely with unsanctioned variations, term LETSystem was put into the protection of The LETSystem Trust in 1997.
• A looser interpretation of the LETS model propagated widely and quickly in the 1990. Many such groups experimented with variations such as demurrage, interest, credit limits, elastic “system accounts”, quirky names, units not metrically-equivalent to the local fiat money, and conflation of the concept of commitment with debt, none of which are compatible with the original LETS/LETSystem design. More often than not, the term “LETS” is used to refer to this broad collection of variants.

Topics where the LETS concept is mentioned:

• collaborative finance
• local currencies
• mutual credit

• The LETSystem archive provides a wealth of useful material.
• An early but helpful description of the LETSystem is provided by Bill Mollison on pp.535-536 of The Permaculture Design Manual (Tagari Press, 1988, 1992).
• The Wikipedia page on LETS repeats a number of historical errors.

(Please sign all commentary.)