A LETS is a form of club allowing members to buy and sell goods and services without using cash. A local currency is used (in the case of LETSBuzz, the Buzzard, and members agree prices in this currency. The system works in a similar way to barter, except that trading can be with any other member of the scheme: you can 'buy' a service off one member and even up the account by 'selling' to another. (In some cases - for example, where a plumber has to buy copper pipe - trades may be agreed as part Buzzard/part cash).
Members of LETS receive ads from other members and have access to an online marketplace, listing all the skills and services available. To arrange a trade, they just contact the other member and make whatever agreement they wish.
The Buzzard has no value outside of the scheme, and it cannot be borrowed, invested or banked. Interest is never earned or paid. There is no central bank and no limit on the amount of currency in circulation.
Within a LETS, prices are set freely by agreement between members and nobody is ever required to trade. The system relies on trust and if you don't trust somebody, you don't have to trade! That said, LETS are local and it is quite possible to know all the other members of the scheme - one important benefit of joining a LETS is a wider circle of friends than before.