"What is #mutualcredit
It’s a means of trading, of exchange, that doesn’t require conventional money, doesn’t incur interest and doesn’t involve banks. It’s based on networks of businesses, traders and individuals who get to know and trust each other in a geographical area or business sector. Each member gets an account. They go into a directory so that suppliers and customers can find each other. When a purchase is made, the buyer’s account goes into debit, and the seller’s account goes into the same amount of credit. But these are just numbers in an account – information, not money that can be hoarded. There’s a limit to how far you can go into credit or debit – and that’s basically it.
Mutual credit is not barter. You don’t have to find someone who has what you want and wants what you have – you just get credit or debit in your account. It’s not a swap. You can then use your credits to trade with anyone else in the network.
There are similarities with local currencies. The main differences (as outlined by Tom Greco) are:
Mutual credit involves a trusted network of traders; local currencies don’t.
Local currencies are bought and redeemed for conventional, bank-issued money; mutual credit isn’t.
Local currencies can still be hoarded and made scarce; mutual credit can’t – it’s just a means of exchange.
History
Mutual credit has a fine pedigree. Pre-money, villagers everywhere traded with each other in credit – you help fix my roof, I give you meat when I kill an animal; you help me harvest my crop, I help you bring in firewood – and so on. The accounting was done informally, in people’s heads, and no money changed hands.
In the 19th century, William Greene, Lysander Spooner and Pierre-Joseph Proudhon championed mutual credit and mutual banking in the US.
During the 1930s depression, various scrip currencies were used, and the mutual credit Wir Bank was born in Switzerland. . . ."
https://systemschangealliance.org/mutual-credit-an-introduction/