Abstract: A recycling apparatus and method for accepting the return of selected types of used containers and for dispensing compensation for the deposit in the apparatus of an approved type of container. A returned container is placed into a depository in the apparatus wherein a scanner reads code markings on the container. If the code indicates the container is of an acceptable type, the container is deposited in a storage receptacle within which the containers are periodically compacted. The customer has the option of selecting compensation from the apparatus of either a given amount of money or a chit worth more than the given amount which may be credited towards the purchase of select products.