PROVISION OF BORROWING FACILITIES. 257 



disappointment afterwards, and no unnecessary alarm caused to the 

 old established village money-lender. 



293. We have been told by some non-official witnesses that, if 

 Agricultural Banks do not lend for miscellaneous purposes, they stand 

 no chance of succeeding, and by other witnesses that, if they do 

 lend for miscellaneous purposes and thus compete with the money- 

 lender, they are sure to fail. We think that both apprehensions 

 arise from a misconception of the objects in view. It is not intended 

 to frighten the village money-lender by permitting a village bank to 

 enter into competition with him over the whole field of his business ; 

 still less is it the intention to encourage borrowing for unproductive 

 purposes. No association borrowing on the joint responsibility of its 

 members would be justified in devoting any of its funds to loans for 

 unproductive purposes. It does not consequently enter into the 

 scope of a village bank's operations to lend for marriage festivities or 

 for caste feasts or similar objects. If people wish to borrow money 

 for such purposes, or for any other purpose unconnected with 

 agriculture, they must still go to the village soivkar or bania. The 

 co-operative agricultural bank only aims at freeing the great 

 business of the cultivator's life from the terrible burden, which now 

 presses on it owing to the usurious interest taken for agricultural loans. 



294. To sum up, the objects of an Agricultural Bank of this 

 kind may thus be enumerated : 



(1) To enable its members to obtain loans at reasonable rates for 



agricultural purposes by placing them in a favourable 

 position to borrow, and by assisting in the creation of a 

 > new credit, which individually they did not possess. 



(2) To provide them with a secure place, in which to deposit 



their small savings. 



(3) To encourage thrift, by holding up before the eyes of the 



members the principle that money should not be 

 borrowed unless for reproductive purposes. 



(4) To promote co-operation among the village community in 



all agricultural affairs. 



295. Having thus defined the scope of an Agricultural Bank's 

 operations, we next wish to enumerate the principles upon which they 

 aie.usually based. They are as follows : 



(1) There should be unlimited liability : members must be 

 jointly and severally responsible for all the obligations 



contracted by their society. 

 33 



