ABSTRACT
As a response to the failure of private financial institutions to equitably meet the needs of large segments of the American population, alternative financial institutions have been created to meet those needs by using different sets of logics and organizing principles. The largest group of these organizations, loosely referred to as Community Development Financial Institutions (CDFIs), have mostly been created with the goal of bringing investment capital to low-income areas that have struggled with capital flight, redlining, and long-term disinvestment. A second set are local currencies, often called Local Exchange Trading Systems (LETS), and are alternative currencies based on place-bound economic relations and mutual trust. This chapter begins by analyzing how the economic restructuring of the last quarter century has dramatically increased the separation between people at the local level and financial institutions, and left low-income people and communities without retail financial services. It then briefly discusses LETS in general and presents the case of Ithaca Hours, which is a LETS system in Ithaca, New York. It then describes the different types of CDFIs and their attributes. The chapter then focuses on one type of CDFI: the community development credit union (CDCU) and its history, structure, and impact in the United States. From there, it presents a case study of one CDCU, Bethex Federal Credit Union in the South Bronx, and concludes by assessing the potential and limits of the collective ownership of money to allow lowincome people to realize local autonomy and economic justice.
