The Crédito was a

local currency In economics, a local currency is a currency that can be spent in a particular geographical locality at participating organisations. A regional currency is a form of local currency encompassing a larger geographical area, while a community curren ...

started on 1 May 1995 in Bernal,

province A province is almost always an administrative division within a country or state. The term derives from the ancient Roman '' provincia'', which was the major territorial and administrative unit of the Roman Empire's territorial possessions ou ...

Buenos Aires Buenos Aires ( or ; ), officially the Autonomous City of Buenos Aires ( es, link=no, Ciudad Autónoma de Buenos Aires), is the capital and primate city of Argentina. The city is located on the western shore of the Río de la Plata, on South ...

Argentina Argentina (), officially the Argentine Republic ( es, link=no, República Argentina), is a country in the southern half of South America. Argentina covers an area of , making it the second-largest country in South America after Brazil, th ...

, on a

garage sale A garage sale (also known as a yard sale, tag sale, moving sale and by many other namesSome rarely used names include "attic sale," "basement sale," "rummage sale," "thrift sale," "patio sale," "lawn sale," and "jumble sale".) is an informal ...

, which was the first of many neighbourhood

barter In trade, barter (derived from ''baretor'') is a system of exchange in which participants in a transaction directly exchange goods or services for other goods or services without using a medium of exchange, such as money. Economists disti ...

markets (''mercados de trueque'') that emerged in Argentina during the

economic crisis An economy is an area of the production, distribution and trade, as well as consumption of goods and services. In general, it is defined as a social domain that emphasize the practices, discourses, and material expressions associated with th ...

. The operator of this currency was the ''Red Global de Clubes de Trueque Multirecíproco'' (RGT), literally "Global Network of Multi-Reciprocal Exchange Clubs" or more simply the "Global Exchange Network" (GEN). The currency started as a

Local Exchange Trading Systems A local exchange trading system (also local employment and trading system or local energy transfer system; abbreviated LETS) is a locally initiated, democratically organised, not-for-profit community enterprise that provides a community infor ...

(LETS) system but was soon replaced by a number of printed currencies and, after further experimentation with a LETS called ''nodine'' (from ''no dinero'', "not money"), finally became the ''Crédito'', a printed currency again. The RGT was organized as a chaordic network of barter clubs, which had a clientele from a well-educated

middle class The middle class refers to a class of people in the middle of a social hierarchy, often defined by occupation, income, education, or social status. The term has historically been associated with modernity, capitalism and political debate. Com ...

that had fallen into

unemployment Unemployment, according to the OECD (Organisation for Economic Co-operation and Development), is people above a specified age (usually 15) not being in paid employment or self-employment but currently available for work during the refere ...

during the Argentine

recession In economics, a recession is a business cycle contraction when there is a general decline in economic activity. Recessions generally occur when there is a widespread drop in spending (an adverse demand shock). This may be triggered by various ...

of the late 1990s. The clubs of the RGT had no central organ, no central administration and no legislation. Clubs decided for themselves to accept the ''Créditos'' of other clubs and not all clubs issued their own ''Créditos''. Clubs that did usually issued between 30 and 50 ''Créditos'' per participant. In a later phase some of the clubs joined zones or networks and zones became the issuers of ''Créditos'' instead of individual clubs. The chaordic structure allowed the system to grow quickly but also left the system vulnerable to fraud. The ''Crédito'' was an interest-free currency and was pegged to the

Argentine peso The peso (established as the ''peso convertible'') is the currency of Argentina, identified by the symbol $ preceding the amount in the same way as many countries using peso or dollar currencies. It is subdivided into 100 ''centavos''. Its ISO 4 ...

, which in turn was pegged to the U. S. dollar at the time. An estimated $400 million in goods and services were traded in 2000. A survey conducted by members of the economics department of

Harvard University Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of high ...

reports a personal exchange rate of about two ''Créditos'' for one peso during 2002-2003 by individuals who offered goods or services in both currencies. By July 2002 the unemployment rate in Argentina was in excess of 20% and approximately 7% of the population participated in the RGT. Argentina had already had a high unemployment rate of about 17% for six years previously. The system was used all over Argentina and worked reasonably well for a time but, as things worsened in the formal economy, more and more people joined the RGT clubs, and a growing percentage of people spent their ''Créditos'' without offering sufficient skills or trade in return. The system suffered from

hyperinflation In economics, hyperinflation is a very high and typically accelerating inflation. It quickly erodes the real value of the local currency, as the prices of all goods increase. This causes people to minimize their holdings in that currency as t ...

and from counterfeiting. Between 2002 and 2003 the government made unemployment insurance available to 2.5 million people, compared to 0.2 million people previously, and thereby increased the availability of the peso to the population stratum using the ''Crédito'', which had an 89% preference for Pesos over ''Créditos''. Other

complementary currencies A complementary currency is a currency or medium of exchange that is not necessarily a national currency, but that is thought of as supplementing or complementing national currencies. Complementary currencies are usually not legal tender and thei ...

in Argentina at that time were the Patacón, the

LECOP The LECOP was a bond issued by Argentine national government. ''LECOP'' (sometimes written as a common word, ''Lecop''), stands for Letra de Cancelación de Obligaciones Provinciales ("Letter of Cancellation of Provincial Obligations"). These bo ...

and the Argentino. The Argentino was never implemented.

References

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External links

Alternative Currencies in Argentina
{{DEFAULTSORT:Credito Currencies of Argentina Local currencies