Recently, 80-year-old Michiko Bito provided advice and moral support to a neighbor on the tiny island of Okamura who was having family troubles. A few days later, when Bito needed help getting cat food from the mainland, she asked another neighbor to pitch in.

The favors were negotiated using an informal local currency known as dan-dans, regional dialect for “thanks again.”

Over the last 18 months, more than 100 community currency programs have sprung up across Japan, ranging in scope from a few dozen people on Okamura to the 90,000 members in Yamato City outside Tokyo.

These trading systems--which allow neighbors to trade good deeds among themselves that in some cases can be redeemed for discounts in local shops--represent Japan’s latest bid to revitalize its local economies, jump-start volunteerism and boost communication.


Local is very much the watchword. Chiba’s “peanuts” are named after the area’s most prominent crop. The currency traded near Lake Biwa in central Japan is made of clay found near the shore. Other regions exchange disks cut from local trees or swatches of regional silks. Then there’s Yamato’s “love” currency, a name that has left some of the locals shaking their heads.

“I’m 44 years old, and I must admit I feel a bit awkward talking about giving my ‘love’ to a customer or taking their ‘love,’ ” says Takashi Uchida, vice chairman of Yamato’s Nijodori Shopping Assn. “Personally, I think the name’s a bit funny.”

Japan’s love affair with community currencies dates to 1973, when a women’s group in Osaka created a “Volunteer Labor Bank” designed to value unpaid housework, says Rui Izumi, a professor at Tsuru University.

Okamura’s dan-dan program got started in 1995 as a way to improve communication between different generations on the isolated island in the Seto Inland Sea and keep young people from moving away.


“I realized even though many of our villagers were old, they had so much to give,” says area resident Masako Kubota. “This allowed them to teach young people to wear kimono in exchange for perhaps being driven for checkups or shopping.”

These were largely isolated efforts, however, until 1999, when a network television show and book on the subject catapulted the idea into the mainstream. Some predict that the number of community currency programs could triple in coming years.

Analysts cite several reasons for the concept’s growing popularity now. The Asian currency crisis and prolonged economic downturn have fueled distrust in some quarters of traditional market mechanisms, they argue. “There’s been a recognition that materialism hasn’t necessarily brought happiness,” says Terue Ohashi, a marketing professor with Reitaku University.

Higher unemployment and more early retirement here have also spurred more interest in and time for volunteerism. And a parade of national scandals is prompting more people to focus on local community activities, where they can exert greater control and influence.


“Society has become more faceless and meaningless,” says Ikuma Saga, an analyst with the Japan Sogo Research Institute. “People are reaching for something that seems real.”

The absolute number of traders remains small, and few expect community currencies to knock Japan’s central bank out of business. But advocates say the grass-roots programs offer something the mighty yen can’t: a way to break the ice between strangers in a culture famous for its formality and reserve.

Kazuhiko Murayama, an urban planning consultant who started Chiba’s peanuts currency in early 2000, is an enthusiastic crusader for a kinder, gentler Japan. His original vision called for peanuts users to hug each other, but he eventually settled on a handshake and a cry of “amigo” by all parties involved at the end of each transaction.

“It’s not been in the Japanese tradition to touch each other,” Murayama says. “By using a foreign word like ‘amigo,’ I thought it would be easier for people to accept a new approach. It’s a tool for communicating and breaking down walls.”


Don’t expect button-down Japanese to turn into kissy-kissy Europeans any time soon, however. “Shaking hands is a good idea, but I don’t think hugging will catch on,” says Makoto Maruyama, international social science professor at Tokyo University. “Some people even say shaking hands is too much, that the whole thing looks a bit like a religious ritual.”

Octogenarian widow Bito and others steeped in traditional Japanese village life sometimes find it a bit sad that modern Japanese need peanuts or silks or even “love” credits to remember to be nice to each other.

But analysts say that, like it or not, the world is addicted to tabs, trading and tallies. “Once people get used to using money in a modern economy, they can’t go back to old traditions,” Maruyama says. “These allow them to use currencies while learning a different way of doing things.”

While community currencies are found around the world, what’s arguably different in Japan is the expectation in some communities that the modest trading plans can significantly boost local economies. Many small shopping districts, known in Japan as shotengai, have embraced them as a weapon against the large discount shopping malls sprouting around them.


“The shotengai are in crisis,” says Takashi Kobayashi, a local Yamato official. “This is a way to help preserve Japanese tradition.”

This may be asking too much of community money, given the parade of economic policies Japan has tried and failed at over the last decade. Furthermore, say nonprofit groups, the growing number of local currency programs being administered by bureaucrats threatens to weaken the spirit of volunteerism and grass-roots glue that has made the smaller examples successful.

Still, supporters say, anything that improves communication can’t be all bad.

“I don’t know what all the fuss is about,” Bito says. “What we’re doing isn’t so great. We’re just trying to help each other out.”


Rie Sasaki in The Times’ Tokyo Bureau contributed to this report.