PROVISION OF BORROWING FACILITIES. 269 



precise object with which we desire to create them. That object 

 may perhaps be defined as the encouragement of individual thrift, 

 and of mutual co-operation among the members, with a view to the 

 utilisation of their combined credit, by the aid of their intimate 

 knowledge of one another's needs and capacities, and of the pressure 

 of local public opinion. 



The main object of our endeavours is to assist agricultural credit, 

 which presents a far more important and more difficult problem than 

 does industrial credit. But we recognise that artisans, employes on 

 small pay, and other persons of small means residing in towns, may 

 very properly be admitted to the benefits of our legislation. We 

 therefore provide for two classes of societies rural, which are composed 

 of agriculturists (a term which is not intended to include the wealthy 

 rent-receiver), and urban, which consist of artisans or other persons 

 of limited means. The members of a rural society may live in a 

 town : so also the members of an urban society may live in a village, 

 but it must be one single village a condition which will exclude in 

 practice all villages that are not sufficiently large to possess an urban 

 character. In the case of both classes we provide that the members 

 must be small men, for we are not legislating for capitalists ; that 

 they must be residents of the same neighbourhood, else the 

 knowledge of one another which is to guide them in their operations 

 will be wanting ; that new members shall be admitted by election 

 only, thus securing that mutual confidence which is the only 

 possible foundation of co-operation ; that a man must be a 

 member before he can borrow from the society, and must in that capacity 

 have contributed to the funds of the society, since our basis is mutual 

 co-operation ; that money shall not be lent on mortgage, so that the 

 capital may be liquid, and capable of ready realisation ; that the 

 interest in a society which may be held by a single member is to be 

 limited, in order to prevent an individual from obtaining control ; and 

 that shares can be transferred subject only to certain restrictions 

 which arl intended to prevent speculation. We provide for a simple 

 form of registration ; for compulsory dissolution, subject to appeal 

 to the Local Government, in order to meet the case of fraud, or of 

 bogus co-operative societies which may have obtained the benefits of 

 the Act while not pursuing its objects ; and for liquidation under a 

 ' sijnple procedure, and subject to appeal to the Civil Courts. 



In the case of rural societies we further insist upon unlimited 

 liability, as best suited to the agricultural classes to whom they are 



