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Thursday, 22 June 2017

Using cheese as collateral in Italy

Italians essentially invented modern banking. And they make amazing cheese. Why not combine the two? Credito Emiliano is one of those ideas you get when you have a little too much wine and parmesan. It’s a bank whose system of credit relies on the deposit and collateralization of cheese. Parmigiano-Reggiano to be exact, according to a video by Great Big Story (runtime 2:23). Parmigiano-Reggiano is a special kind of cheese because it needs to be aged for 16 to 36 months, and a wheel can be worth thousands of USD, making it a safe long-term investment for the bank. The 300,000 wheels of this cheese that the bank has on deposit in special warehouses are now worth over EUR 160 mn.

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