Hidden Credit Networks Rivaled Banks Long Before Banks Existed
A new analysis of 17th- and 18th-century Alsatian lending records reveals that peer-to-peer credit—informal loans between neighbors and acquaintances—matched the volume of formal notarized contracts, upending assumptions about early modern finance. The finding suggests informal lending networks may be far more economically consequential than historians realized, with implications for understanding how credit markets function when institutions are weak.
Originaltitel: Peer-to-Peer Lending in Non-intermediated Credit Markets
<p>Chapter 2 focuses on the non-intermediated market and its actors from c. 1650 to 1790. These credit markets functioned as peer-to-peer or interpersonal lending, exchanges that featured either a private written agreement or a verbal promise. Often considered merely as simple daily transactions made to alleviate a lack of cash in circulation and to smooth consumption, they are often eclipsed by notarial credit. In this chapter, the probate inventories of seigneuries in the south of Alsace highlight the various features of these peer-to-peer exchanges and give particular attention to the profiles of lenders and borrowers, the purpose of the loans, and the networks of exchange at work. This chapter shows that these exchanges were in fact of significance. The volume of exchange competed well with notarized loan contracts, which prompts questioning the nature and function of non-intermediated credit.</p>