Paying with 'kisses' as Brazil’s social currencies spread

Heraldo Rodrigues da Silva Heraldo Rodrigues da Silva has taken two loans from a community bank

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Shopkeeper Heraldo Rodrigues da Silva, 55, owns a small store in Sao Benedito, one of the poorest neighbourhoods in Vitoria, the capital of the Brazilian state of Espirito Santo.

On the wall behind his counter, a sign announces that besides the real - Brazil's legal tender - he accepts the "bem", an alternative currency from a local community development bank, Banco Bem.

Start Quote

Leonora Mol

The goal of...a social currency is to encourage people to use that money within their community and contribute to the development of the local economy”

End Quote Leonora Mol Manager, Banco Bem

The bank was founded in 2005 by an association of seamstresses who decided to lend their profits to a group of furniture makers so that they too could start their own collective.

There are some 100 similar microfinance banks in Brazil, as well as many barter initiatives that also involve social currencies. The banks' aim is to promote the principles of a "solidarity-based economy" which, in their view, is fairer and more sustainable than the dominant capitalist model.

Their clients can pay with colourful bills called, for example, palm-trees (palmas), chestnuts (castanhas), sunflowers (girassois), and kisses (beijos).

Even Cidade de Deus, the Rio de Janeiro's favela made famous through Fernando Meirelles's film City of God, has its own money, the CDD.

Like Cidade de Deus, Sao Benedito used to be extremely violent and drug trafficking was rife. But like several Rio slums, it has now been heavily occupied by the police and local people say they feel much safer.

Sao Benedito residents also say life has improved in recent years thanks to the social policies of the governments of former President Luiz Inacio Lula da Silva and his successor, Dilma Rousseff - and thanks to local projects like Banco Bem.

"Through Banco Bem, they started to encourage me, to help me, to support me," Mr Rodrigues da Silva, a former bricklayer, said.

He has taken out two loans from the bank, the first one to build his shop and the second one to enlarge it.

"Trade has grown a lot recently. Many more people are coming to spend their money here and a lot of them are paying with bens," he added, with a big smile.

Hilma Soares Faria Seamstress Hilma Soares Faria is one of Banco Bem's founders
Buying locally

Banco Bem was inspired by Banco Palmas, Brazil's first community bank founded 15 years ago in the north-eastern city of Fortaleza.

"The goal of having a social currency is to encourage people to use that money within their community and contribute to the development of the local economy," Banco Bem's manager Leonora Mol, a psychologist with a long history in social work, told the BBC.

Solidarity-based economy: Principles

Brazilian social currencies
  • Self-management
  • Democratisation of the economic relations
  • Co-operation instead of forced competition
  • Valuing diversity. Human beings are more important than profits
  • Valuing local knowledge, constant learning and training
  • Social justice and emancipation
  • Protection of the environment

Source: National Secretariat of Solidarity Economy, Brazil

"Our lending system is very straightforward. The neighbours decide who should get the loans. We ask them a very simple question: if this money were yours would you lend it to this person?," she explained.

The bank is now encouraging small retailers to get together so that they can negotiate better prices with the big suppliers and supermarkets.

Banco Bem is also helping to transform areas which were used as rubbish dumps into attractive social spaces, like parks and open-air theatres.

Across a bridge from Vitoria, in Vila Velha, another community bank has also declared a war on rubbish.

Banco Verde Vida (Green Life Bank) pays with its moeda verde (green currency) for recyclable materials such as plastic bottles, tins and used cooking oil.

Twice a week there is a constant flow of people - mostly women - with wheelbarrows full of refuse they have collected in the area.

Next to the bank's entrance there is a small store where people can use their green bills to buy food or cleaning materials at very low prices. Alternatively, they can pay with them in other local shops.

"We started when we realised that we had to do something before rubbish completely destroyed our environment," the bank's manager, Joao Manoel Ribeiro dos Santos, also a former bricklayer, said.

"We have a river, the Aribiri, where people used to fish - you could even see the fish from the bridge - and children swam. Plastic put an end to all that. During the rainy season we began to have floods; water would even get in through the windows."

Although the river is still far from recovery, local people are proud of what they have achieved so far.

"This is the third wheelbarrow full of bottles that my mother and I have brought in today. My mother collects them. It helps us financially but you should also see how clean our streets are now," a young woman said.

Community confidence

Brazil's community banks now have the government's support, mostly through the National Secretariat of Solidarity Economy (Senaes) in the Labour and Employment Ministry.

Collection day at Banco Verde Vida Banco Verde Vida recycles plastic bottles, tins and used cooking oil

"The Central Bank used to have reservations about our social currencies but it has recognised the importance of our work and has accepted them, in part thanks to Senaes, which was established by Lula," Mr Ribeiro dos Santos said.

He sees a fundamental change in the way Brazilian society now works.

"We've lost our fear of negotiating with the government. Before, you couldn't even approach the local authorities, let alone the Central Bank," he explained.

"We have gained confidence in what we can achieve with few resources but with lots of good will, step by step."

According to Ms Mol, one of their most important next steps is to adopt a common system for the 11 community banks in Espirito Santo to have a better idea of the different ways their money is being spent.

"But hopefully in a few years' time there will be no need for our alternative currencies, as most people will be buying locally and helping their communities to grow," she said.

Sao Benedito Sao Benedito, like many other Brazilian favelas, has seen big changes

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