PROVISION OF BORROWING FACILITIES. 305 



supplied, which the usurer lacked, seem to be among the reasons 

 which have determined all European Governments to interfere more or 

 less completely in the guidance and supervision of the land banks. 

 The conditions which existed at the starting of the banks determined 

 this action : the people were either nobles whose position round the 

 throne, and in the then economy of their country, required the support 

 of legally secured credit, or they were poor and ignorant peasants 

 whose very life blood was being drained by private usury ; nobles and 

 peasants alike were in the hands of the money-lenders, and were 

 incapable by their sole efforts of extricating themselves or of managing 

 credit associations ^without supervision. Again, in late years it was 

 necessary, in the still unimproved condition of the petty proprietary 

 who form the great mass of landholders to prevent associations of 

 capitalists from exploiting the country, as the individual money-lenders 

 had done before them ; per contra owing to the extreme difficulty of 

 dealing successfully with ignorant, suspicious, heavily indebted masses 

 of small holders, Government connection with the banks was needed to 

 give that official sanction and support which in much-governed Europe 

 is the sine qua non of rural dealing. Hence the great difference 

 between the history of continental land banking and the banking of 

 England and Scotland, and it may well be that in this, which is found 

 a necessity in Europe and strange to say as will be hereafter seen in 

 the most independent of countries, the United States of America, there 

 is a lesson for Indian rural land banking. Free banking suits English 

 and Scotch conditions and the peculiar history and development of 

 society and of economic history in those countries, but is not necessarily 

 suitable to other conditions as in India ; nay, it may be a grave 

 error. 



CREDIT AGRICOLE.* 



In Europe, rural credit is generally divided into Credit Foncier or 

 immobilier, and credit mobilier or ayricole. 



The latter form of credit includes chattel credit, i.e., the credit 

 based on movables, such as crops, stock, furniture, etc., and personal 



* In Europe the words 'Credit Agricolo' arc used in a technical sense; thry 

 do, not moan 'agricultural credit' i.e. credit in general granted to agriculturists, but 

 those particular classes of agricultural credit not covered by land ciedit,**namely 

 chattel and personal credit. 



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