Cassa peota (Italy)
|Cassa peota 🇮🇹|
|Definition: A trust-based system of micro-credit and mutual insurance, used in Venice, Italy|
|Keywords: Italy – Europe – EU – Credit – Micro-credit – Saving – Loan – Money – ROSCA – Mutual help – Sociability – Community – Food|
|Clusters: Solidarity – Lock-in effect – Informal welfare|
|Author: Giulio Benedetti|
|Affiliation: Alumnus, School of Slavonic and East European Studies, University College London, UK|
By Giulio Benedetti, Alumnus, School of Slavonic and East European Studies, University College London, UK
| Cassa peota (pl. casse peota) is a trust-based system of micro-credit and mutual insurance, used in Venice, Italy. It consists of a common fund from which associates can borrow money at low rates and use it for small investments. The earnings made by the fund are typically spent on collective feasting occasions, redistributed back to associates, or donated to charity every year. The latest account of cassa peota, published by the Bank of Italy in 2010, recorded 76 associations (Banca d’Italia 2018).
First regulated by the Italian law only in 1999, the practice kept its informal character for most part of its long history. It dates back to the fifteenth century and appears on written records related to Lorenzo Giustiniani, the bishop and patriarch of Venice between 1433 and 1456 (Tramontin 1985). Cassa peota began to operate in the Venice lagoon and the surrounding areas to connect the needs of two key lower class social groups: small business owners (artisans and merchants) and the oarsmen who rowed the ships of the Venetian Republic (Cacciavillani 2013: 127-129).
For long time one of the most thriving metropolis of Europe, Venice offered great opportunities to artisans and businessmen. In times of crisis, however, small businesses were at risk of being put in prison because of debts; this led to a vicious circle, as prisoners were unable to earn the money necessary to regain their freedom (Cacciavillani, 2013: 127-129). Oarsmen faced a mirrored problem. Their job was poorly paid, but they were allowed to trade everything they could store under their seat. With some luck, good investments and access to Venetian markets – the best in the world – this personal trade could generate a small fortune (Lane 1978: 62-64, 201). On their return to the capital, having sold their merchandise, the oarsmen needed a way to store their money safely, before heading abroad again for months-long periods (Cacciavillani 2013:124-127).
Casse peota met these two necessities: oarsmen deposited their wealth safely, while small business owners were granted loans to avoid prison, on the condition that they made weekly payments, called “carato”, which gradually repaid the debt. Failure to do so would mean imprisonment (Cacciavillani, 2013:127-129). The well-known and respected ship pilots were the guarantors of this system. The pilots were often more important to the everyday life of Venetian vessels than the ship captains and they enjoyed great respect among the lower classes of the city. An early interpretation of the name of this practice is associated with their role: “peota” is the Venetian term for “pilot”, while “cassa” can be translated with "fund" or "bank", like in "cassa comune", standing for the common fund of money (Ragazzini 2007).
In 1913, a survey conducted in Venetian osterie, recorded 385 casse corresponding to 11,487 associates (Casellato 2002: 1594). Osterie, the local traditional taverns and a pillar of the sociability of the working classes of the city, were central for the development of the practice (Buonanno 2014: 80). Four decades later, a short survey published in the local media estimated the number of casse to exceed one thousand (Dell'Oro 1959). A medium-sized cassa in the 1950s held around thirty people, and the purpose of a cassa was, same as in the past centuries, to provide loans at very low rates to their associates, or to make cautious investments (Casellato 2002:1594-1596).
The cassa mechanism was also employed by richer retailers, who saw the casse as an opportunity to preserve their capital; for factory workers, who interpreted them as collective insurance against injuries and firings; and for piecework labourers, for whom they were a way out of problems and a chance for an occasional rich feast. Any earnings made in excess of insurance coverage were often spent for extravagant meals and trips to the mainland, which in the case of wealthier casse lasted for several days. Large fluvial boats, called peota, were used to navigate upstream the rivers of the mainland: the latest interpretation of the name origin of the practice draws on these trips.
Cassa peota binds participants together in a tight association of an economic purpose and is supported by leisure activities such as feasting and travelling, which strengthen trust among participants and represent a guarantee that everybody will keep their economic obligations. It enables individuals without access to the formal banking system to gain credit using interpersonal trust. Although widespread among the working classes and small traders, casse peota were not formalised until 1999, when an EU banking reform would have rendered the casse illegal, if the Venetian local politicians and regional administration would not have mobilized to preserve them by formalizing their existence (Senato 1998). Today the casse are strictly limited to operate outside the share of the bank market and are regulated by legislation concerning non-profit private intermediaries (Banca d’Italia 2018a).
Many practices around the world share similarities with cassa peota. The closest is the Filipino practice of sosyudad, which combines economic deeds and collective feasting to reinforce mutual trust. A similar practice is also the Russian pomochi, in which the mutual energies are congealed in support of the immediate needs of one, who in turn rewards the group with an occasion of collective conviviality. This practice differs from cassa in that it is not monetized, and it conducted spontaneously. The Vietnamese vay muon, shares the characteristic of borrowing money from a large number of sources, but it is not a stable association, and revolves around a single individual. Vay mu'o'n also lacks the leisure element that unites other practices. Practices such as loteria, esusu and other ROSCA associations share with the Venetian practice the credit-oriented associative character, but they lack the mechanism of fostering trust through collective leisure. ROSCAs are not meant to survive their purpose, as any earning is strictly individual, and not collectively managed.
Cassa peota was born embedded in an environment of trade relations, which determined its long-term purpose. The formal framework of trade influenced the time frame of the participation of the rowers, as trade trips were planned by the public regulator, while the debt laws pushed the owners of small businesses to join the casse. The practice evolved through the centuries, responding to changes in the formal framework. It reached the factory workers during industrialization, when it became useful as a collective unemployment, accident or pension insurance. As the State gradually took upon itself to provision such services, the factory-based casse gradually lost importance. Today this practice is closer to the banking system and used to softening its severity.
Banca d’Italia. 2018. http://www.bancaditalia.it/compiti/vigilanza/avvisi-pub/decreto-13082010-141/index.html
Banca d’Italia. 2018a. Testo Unico Bancario. Legislative decree n.385/1993, adjourned by the decree n.218/2017
Buonanno, I. 2014. ‘The history of wine shops in Venice’, in C. Favero (ed.), Venice and Viticulture. Cittadella (Pd): Biblos edizioni: 64-83
Cacciavillani, I. 2013. Il "sociale" a Venezia: interventi "sociali" nell'ordinamento della Serenissima. Padova: Panda Edizioni
Casellato, A. 2002. ‘Sestieri popolari’, in S. Woolf and M. Isnenghi (ed.), Storia di Venezia, L’Ottocento e il Novecento. Roma: Istituto della Enciclopedia Italiana: 1581-1621
Davydova, I. 2018. ‘Pomochi’, in A. Ledeneva (ed.), Global Encylopaedia of Informality. Vol. 2. London: UCL Press
Dell'Oro, G. 1959. ‘Ancora più di mille in città le 'casse peote' e le 'mutue'’. Il Gazzettino, 27 August
Imami D., Polese A., Rama K. 2018. ‘Loteria/Lloteria’, in A. Ledeneva (ed.), Global Encylopaedia of Informality. Vol. 2. London: UCL Press
Lane, F. C. 1978. Storia di Venezia. Torino: Einaudi Edizioni
Ledeneva, A. 2018. Global Encyclopaedia of Informality. Vol. 2. London: UCL Press
Osabuohien E., Oluyomi O. 2018. ‘Esusu’ in: A. Ledeneva (ed.), Global Encylopaedia of Informality. Vol. 2. London: UCL Press
Polese, A. 2018. ‘Vay mu'o'n’, in: A. Ledeneva (ed.), Global Encylopaedia of Informality. Vol. 2. London: UCL Press
Ragazzini, G. 2007. Dizionario Inglese-Italiano, Italiano-Inglese. Bologna: Zanichelli
Sarmiento, R.F. 2018 ‘Sosyudad’, in: A. Ledeneva, (ed.), Global Encylopaedia of Informality. Vol. 2. London: UCL Press
Senato della Repubblica, 1998. Written responses to parliamentary interrogations. http://www.senato.it/service/PDF/PDFServer/DF/17789.pdf
Tramontin, S. 1985. Venezia e Lorenzo Giustiniani. Venezia: Comune di Venezia
Vélez-Ibáñez, C.G. 2018. ‘Tandas and cundinas’, in: A. Ledeneva (ed.), Global Encylopaedia of Informality. Vol. 2. London: UCL Press