This design research project included 19 street vendors over 5 months in Bogotá. The idea was to explore the relationship of the vendors with money, savings and credit. It was a very revealing experience, that showed to us how the understanding of money for the vendors, as well as their aspirations for the future are collective constructs rather than individual perceptions only. This study included individual interviews, as well as economic experiments to explore dynamics of cooperation amongst the vendors.
Street vendors constitute a complex network of actors across sectors, ranging from civil society to distributors, intermediaries and local governments. The vendors have perceptions and imaginaries about money and their individual scope for saving. These perceptions are not individual, they are shaped by the collective that the vendors are part of. The way they allocate themselves in the public space and the configuration of power centers are key determinants for their possibilities to save money together.
While doing this study I was advised by professors at the School of Economics, who introduced me to the tendency of calling 'patterns' to all the activities shared by several vendors. However, I started finding how those commonalities actually configure collective ways of doing things -as oppose to many people doing the same thing.
Collective ambitions to stay in the informality
Vendors identify themselves as part of a collective that functions within circuits of informality and invasion of the public space, therefore their business is very volatile. Many studies consider the flexibility in terms of work timings and location to work, as well as the easy logistics to sustain this business, as the main reasons for vendors not to enter the formal markets. This argument considers the street sales as a very static activity, as if its conditions were the same for all periods of time, or would affect all of them in the same way. In reality, understanding why the vendors prefer to stay in the informality will take us to moments even before they start this business.
The big majority of street vendors started their business as an imitation or by recommendation of a family member or a friend. Most of the vendors start this business as an alternative to precarious economic conditions and it does work as a sort of escape, because street sales is not a very capital-intensive business at the beginning and is a very convenient channel for people, so there are always costumers. At a less practical level, the ambitions when starting the business were in all cases shaped by friends or family members who recommended them to become street vendors.
This is one of the important aspects when understanding collective imaginaries about money. Given the lack of tools to actually predict the profitability of the business, the streets vendors enter this circle with the hope to overcome a particular economic down, but not as a stepping-stone that will move them towards greater economic stability. As a consequence, the rationale for not transitioning to formal economic activities is linked to the lack of incentives to make the business grow (a collective motivation), rather than to their conformity within the informality.
Collective creativity and debts
The way vendors arrange and decorate their tools for work is constantly inspired by others, not only while setting up the business but as an ongoing practice. This creativity also transcends when it comes to saving money together, as it is the case of the Rotating Savings and Credit Association (ROSCAs), locally known as "cadenas".
17 out of 19 street vendors have been part of a cadena in the past or at the moment of our conversations. In most of the cases, cadenas are constituted amongst street vendors only and additional participants are their family members. Cadenas start after gathering people and nominating one person as the accountant. The group decides on an individual periodic monetary contribution that is taken by one of the members in a random fashion, until all of them have collected their part and the cadena starts again.
For the vendors, the most prevalent reason to start a cadena is for paying debts. And here is another important aspect about collectiveness in street sales. Debts are a constant concern and involve not only debts to financial institutions but amongst the vendors too. Interestingly, the vendors interact in circles of debt and credit that they recognize as unsustainable and as the biggest obstacle for their personal financial management. Cadenas become the tool to solve this worrying problem, but the constant involvement in collective pools of money is not seen as an additional debt (sometimes with the same person that loaned them money outside of the cadena) but as a responsibility with the collective. However, apart from solving the immediate need for paying debts, cadenas do not provide any tools for savings and credit management.
On the other hand, the financial circuits that street vendors are subscribed to, are characterized by being a low-costs environment, where very rarely they have access to amounts of money exceeding the basic monthly subsistence. This is not only a description of the financial profile of vendors, but for them itself creates a low-costs imaginary. They have adapted themselves and their families to cycles of paying small and continuous debts but not reserving money for the future, not only because money is not enough, but because there is no optimism on achieving larger goals, where the concept of financial growth doesn't sound realistic.
Collective perceptions of power
Given the conglomerates of street-vendors families located in specific sectors, there are localized power centers that determine the entry or exit of other vendors in the same sector. Having into account that choosing a specific street to work on is indeed a strategic decision, where the type of consumers and their frequency are the most important variables, then some of them don't get the chance to sit in privileged spots. All street vendors start with an improvised 'cart' structure where they showcase their products and some of them are eligible to get a kiosk adjudicated by the local government, which fixes their location in the streets, disrupting the order established by the vendors by fixing the locations of some.
The spatial networks of vendor suggest mutual support and obligations, that constitute an actual network where savings can happen. However, the complexities of occupying a certain spot, in tandem with the local networks mediated by political leaders, translates into political segregation in the distribution of the space that makes difficult for some vendors to associate with others.
On cooperation with other vendors
Even though this is a complex network, the collectiveness that vendors represent does have space for collaboration and cooperation. In a short economic experiment where I created a hypothetical situation to test willingness to collaborate with other 2 or 3 vendors, they are pretty much willing to collaborate with another person, especially if she or he is located near their spot, so they can follow-up on a regular basis and directly with the person. In all cases, vendors were willing to risk a small amount of money for getting long-term benefits collectively with other vendors.