A REVOLUTION IX FINANCE 275 



was equal to 48 per cent, per annum on the 

 sum borrowed. 



The agricultural credit banks are changing 

 all this. Based on the principle of unlimited 

 liability, they are formed by combinations of 

 peasantry, farmers, and better class sympathizers, 

 and are managed on the most economical method, 

 all the officials giving their services gratuitously. 

 With the personal guarantees of the members 

 for the return of the sums borrowed, no difficulty 

 is (as a rule) found by the rural banks in getting 

 substantial sums at 4 per cent, from the Joint 

 Stock banks, which, generally speaking, regard 

 the rural banks as desirable " feeders," and well 

 deserving of encouragement. From the agri- 

 cultural credit bank the farmer gets a loan at the 

 rate of one penny per £ per month for such 

 time as he may require it. The interest is not 

 deducted in advance, and he incurs practically 

 no travelling or other expenses either at the time 

 he obtains the loan, or when he seeks its renewal. 

 In actual practice the loans granted range from 

 £2 to £10, the average being £8 or £4. Hitherto 

 the banks have (so far as can be ascertained) 

 made only one bad debt. In the course of a 

 single year a bank established in one of the 

 congested districts on the west coast granted 

 400 loans to small farmers, and in eleven cases 



