The Early Modern Financial System and the Informal Credit Market

2010 ◽  
pp. 14-40
Author(s):  
Klas Nyberg
Keyword(s):  
Early Modern ◽  
Financial System ◽  
Credit Market ◽  
Informal Credit

scholarly journals Parish banking in informal credit markets: the business of private lending in early nineteenth-century Sweden

2017 ◽  
Vol 24 (1) ◽  
pp. 83-102 ◽  
Author(s):  
Håkan Lindgren
Keyword(s):  
Early Modern ◽  
Credit Markets ◽  
Banking System ◽  
Early Modern Europe ◽  
Early Nineteenth Century ◽  
Informal Credit ◽  
Access To Credit ◽  
Private Lending ◽  
Banking Business ◽  
Intimate Knowledge

This study demonstrates the existence of a private, informal and lively credit market in rural Sweden during the 1840s, a period that predates the development of a modern banking system. The market, mainly based on private promissory notes, was concentrated in the hands of a limited number of wealthy farmers who specialized in lending, They facilitated access to credit to well-off farmers, regardless of whether they owned their farms or leased taxed land. By using information from probate inventories, the article analyses the wealth portfolio and characteristics of the lending business of the largest creditors (‘parish bankers’) in a judicial district of southern Sweden in 1841–5. The heart and soul of their business was an intimate knowledge of borrowers’ creditworthiness and mutual trust, as typical of local credit networks. The article also explores the existence of an intergenerational transmission of parish banking business – a dimension of private lending that opens an original path of research on local credit markets in early modern Europe.

Informal Loans in Russia: Why Not to Borrow from a Bank?

2016 ◽  
Vol 19 (03) ◽  
pp. 1650016
Author(s):  
Maria Semenova ◽  
Victoria Kulikova
Keyword(s):  
Great Proportion ◽  
National Survey ◽  
Growth Rates ◽  
Financial Literacy ◽  
Banking Sector ◽  
High Growth ◽  
Credit Market ◽  
Credit Rationing ◽  
Informal Credit ◽  
Loan Market

After the 2008 crisis, the Russian consumer loan market shows high growth rates, accompanied by the quality deteriorating even faster. At the same time, a great proportion of households are not attracted by the banks and borrow informally. In this paper, we aim to learn why households refuse to become bank clients, using the data from a 2009–2010 national survey of Russian households. Our results suggest that household's choice of the informal credit market is based not only on credit rationing, but also on a lack of financial literacy, credit discipline and trust in the banking sector as a whole.

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