Time banks and alternative currencies can be used to trade goods as well as services

Psychologist Angels Corcoles recently taught a seminar about self-empowerment for women, and when she finished the organisers handed her a cheque with her fee. The amount was in hours, not euros.

But Corcoles didn't mind. Through a citywide credit network that allows people to trade services without money, the 10 hours Corcoles earned could be used to pay for a haircut, yoga classes or even carpentry work.

At a time when the future of the euro is in doubt and millions are unemployed, a parallel economy is springing up in parts of Spain, allowing people to live outside the single currency.

In the city of Málaga, on the country's southern Mediterranean coast just 130km from Africa, residents have set up an online site that allows them to earn money and buy products using a virtual currency. The Catalonian fishing town of Vilanova i la Geltrù has launched a similar experiment but with a paper credit card of sorts. It implements a new currency worth slightly more than the euro when it is used at local stores.

In Barcelona, the preferred model is time banks, which allow people to trade their services in hours without the involvement of money at all.

"This is a way for people who are on the fringes of the economy to participate again," said Josefina Altes, co-ordinator of the Spanish Time Bank Network.

Similar projects are popping up in Greece, Portugal and other eurozone countries with troubled economies.

These experiments aim to take communities back to a time when goods and services were bartered, before things such as interest rates, market speculation and derivatives complicated the financial world.

While some local governments have backed these efforts, others have raised questions about their implications for taxes, the effect on local wages and the potential for fraud.

Social money or alternative currency systems have existed throughout history, mostly in places such as remote coal towns or occupied countries during war, or during times of great economic stress.

Many of these efforts took years to set up, and the number of people involved is limited. In Spain, however, the economic crisis has been an impetus to move faster. There are now more than 325 time banks and alternative currency systems in Spain involving tens of thousands of citizens. Collectively, these projects represent one of the largest experiments in social money in modern times.

Peter North, a senior lecturer at the University of Liverpool who has written two books about the subject, said alternative currencies – or scrips – have tended to appear during times of crisis and often disappear soon afterwards. But North says the efforts in Spain may last longer because they are connected to the 15M, or indignados, movement, originally a youth initiative organised through internet sites that was the inspiration for the Occupy protests.

"Instead of just being a desperate way for people to survive a horrible economic crisis, this is part of the co-operatives, credit unions, community banks, organic farms and recovering factories – the alternate economy – that the Occupy movement is groping towards," North said.

While each social-money project has its own accounting rules, the basic concept is the same. You earn credits by providing services or selling goods, and you can redeem the credits with people or businesses in the network.

In Vilanova i la Geltrù's central square, a growing number of stores – including an upscale artisanal Catalonian bread shop, a deli and an electronics shop – now post blue Turutas aqui si (Turutas accepted here) signs in their windows.

Started as a way of breaking with the global financial system, the alternative currency – named after a traditional wind instrument – has been embraced by only about 190 of the town's 67,000 residents. But organisers say more are signing up as the crisis deepens.

Ton Dalmau, 57, one of the founders of the initiative, said the goal is to keep the money in circulation, which means that the bank where people keep their Turutas does not offer any interest.

"We are returning money to its origins and making it purely a system of exchange," he said.

Jordi Morera, 25, whose family owns the bread shop, said that accepting Turturas hurts his bottom line because his raw materials can be paid for only in euros. But he said the sacrifice is worth it because he believes in the goals of the initiative.

"Money limits our lives more than we realise," Morera said.

In Málaga, David Chapman, 65, said social money encourages innovation because you have to start thinking about different services or products you can offer to be able to participate in the market.

Chapman, a carpenter originally from Britain who has made Spain his home for 25 years, said he recently sold six sun ovens he made himself for a total of 300 comuns, the community's virtual currency. He was planning on cashing some of them in to pay someone to paint his house.

Launched three years ago by Chapman and some friends, the project has seen dramatic growth. From March to August, the number of people using the virtual currency has jumped from around 250 to 470, with most of the newcomers in their 20s and 30s.

The scale of the Barcelona projects is significantly larger, with more than 100 time banks that range in size from a few dozen members to 3,000.

Many of the time banks operate like real banks – with individual accounts, ledgers, chequebooks and, in many cases, even auditors. Some conduct transactions with physical checks and are overseen by a secretary who keeps track of deposits. Others exist solely on the internet.

Sergi Alonso, a 30-year-old computer technician who has been unable to find a full-time job, said he has helped numerous neighbours develop web pages and troubleshoot hardware problems through a time bank. In return, he was able to get private sewing instruction and piano lessons and learn about graphic design.

Time banks help remind people that "regardless of your skills, you can always bring things to others", Alonso said.

This story appeared in the Guardian Weekly, which incorporates material from the Washington Post