INFORMATIOX RELATING TO CO-OPERATION AND ASSOCIATION 35 



of each share as reserve liabiHty in the case of agricultural credit societies 

 and supervising unions, and to require an entrance fee of one rupee, so that 

 any society wishing to take a share may remit 6 rupees — or ii rupees if 

 it be a non-agricultural society -- to its own Central Bank. One thousand 

 additional shares will be offered to indi\'idual capitalists, on condition that 

 in their case one tenth of the value of each share be paid with the applica- 

 tion and the rest on allotment, and with the further reservation that shares 

 will be allotted to individuals only after at least an equivalent number of 

 shares have been taken up by the societies. This provise will secure a 

 majority of votes to the societies. 



It is hoped that if the Provincial Bank attain to a taorkino capital 

 of 1,000,000 rupees it will be able to lend to Central Banks at a rate not 

 exceeding 6 ^/^ per cent. 



Deposits will be received by the Provincial Bank at rates not exceed- 

 ing the lowest now offered by Central Banks, namely 6 per cent, for long 

 term deposits and 5 ^ per cent, and 5 per cent, for short terms. 



It is proposed that all the overdrafts now granted by the Bank of Ma- 

 dras to Central Banks be transferred to the Provincial Bank, the latter 

 granting in its turn an equivalent overdraft to each affiliated Central Bank 

 and charging either the same rate of interest as that now allowed by the 

 Bank o^ Madras or one quarter per cent. more. 



Deposits received by Central Banks may be transferred, if there be 

 no outlet for their expenditure in such banks, to the Provincial Bank which 

 will protect the receiving bank from loss by paying the regvtlar rate of in- 

 terest on them. 



If the bank rely mainly on society shareholders for its share capital, 

 it will not be necessary to declare a highef dividend than 6 per cent. 



The board of management of the Provincial Bank will consist of re- 

 presentatives of individual shareholders, of Central Banks and of primary 

 societies, the two latter groups forming a majority. The board will elect 

 a standing committee of at least three members, who will, together with 

 the secretary, direct the business of the bank according to standing orders 

 issued by the board. The latter will probably meet once in three months. 



3. CO-OPERATIVI': DI.STRIBUTION IN NORTHERN INDIA. — Mr. A. C. Cliatterjee 

 in Indian Journal of Economics , Apxi] 1916, quoted in I'hc Madras: BulUiin of Co-orercUion, 

 Vol. VIII. No. I, .September 1916. 



Co-operative Seed Supp.y. — In the villages of Northerm India the 

 rural lender lends seed grain as well as money and to a large extent. Un- 

 fortui^ately the cultivator has, when be borrows the grain at sowing time, 

 absolutely no choice with regard to the quality of the .seed that he gets. 

 After a famine the lenders often refuse to advance it except at prohibitive 



