Waste co-op banks fighting poverty and helping the environment

Bank Sampah

Tuesday, February 13, 2018

With nearly 64 million tonnes being created each year, waste in Indonesia is a big problem. In 2004 an initiative was set up by local people to combat this problem, a co-op designed for two purposes. The solution is two-fold: cutting waste through reuse and recycling, and allowing local people to save money and gain credit from waste that would normally just be disposed of.

Waste banks are set up in neighbourhoods, typically for about 1000 residents, and are usually run by poorer people who wish to increase their income. Bank customers, often women, bring recyclable items such as plastic bottles and papers to the banks where it is treated like a deposit. Rubbish is weighed and given a monetary value. The waste banks sell the deposited material to mobile agents for reuse or recycling, or to local governments who also recycle.

The waste deposits are transformed into money that can be withdrawn when needed after a contribution of about 15% is deducted for the bank’s operating costs. Customers can open an account, make deposits, and withdraw funds - working almost like a regular bank. Though most of the account holders are savers, customers can also borrow money, paying it back in rubbish, thus creating a credit system.

Over 2200 banks have now been opened across Indonesia. It’s estimated that, thanks to the movement, the amount of waste sent to final disposal in 2017 decreased by 4,787 tonnes, meaning that as well as helping some of the poorest people in Indonesia, the scheme is also having an impact on the environment.

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