cclxxxii 



per Rs. 100, irrespective of tlie price of paddy at the time it is paid. 

 Compound interest is very unusual in any case. 



3. Result of the system. — Much misapprehension prevails as to the 

 character of money-lenders or as to the result of borrowing. Human 

 nature is the same at all times and at aU places, and where there is a 

 difference it is wholly due to the influence to which it is subject. A 

 capitalist will willingly pay a premium to pm-chase a 4 per cent. 

 Government security ; but is very reluctant to lend money at 12 per 

 cent, to a near relation. He is not capricious and it will not be diflB- 

 cult to know his motive. The much-abused Marwadies risk their 

 money on personal credit, and interest cannot be the same where the 

 risks are not. Professional money-lenders have no longing for lands, 

 because their avocation is not agricultural. When they buy, they do 

 so against their will for want of other buyers, and sell them when they 

 can. The position of the agricultural borrowers has greatly improved 

 and that of the professional money-lenders has deteriorated during the 

 last quarter of a century. The value of money having fallen or that 

 of the agricultural produce risen, the money lent is returned when it is 

 not worth as much as when it was given. The value so far is trans- 

 ferred from the one class to the other .... * This will show that 

 the money-lender has been a blessing instead of a curse, and he has 

 been improving, unconciously though it be, the position of the agricul- 

 turists in his own district. I have experience of two or three districts, 

 and I am able to state that the improvement is marked and perceptible 

 to all unprejudiced observers. Nearly half of the huts that existed 

 twenty-five years ago have disappeared, and tiled houses have taken 

 their places. Houses which were tiled then have changed their 

 dimensions and appearance now. So in clothiag and other comforts. 

 Agriculturists have in their turn become money-lenders and have learnt 

 to dispense with the aid of the professional money-lenders to a very 

 great extent. The improvement in material prosperity can be easily 

 gauged by the fall in the interest, which was then 12 per cent, at least 

 (then called charitable or ^trLneuiLt^-)^ is now nearly 6 per cent. Time 

 has come when ryots are able to take advantage of any help that may 

 be rendered to them to organize a system of mutual credit on the lines 

 that will hereafter be explained. Farm servants are a diminishing class. 

 Their ambition is to become farmers. By getting a small loan for 

 purchasing one bullock or two, by industry and economy, they become 

 in time proprietors of a plough and a pair of cattle and are able to 

 maintain themselves independently. As farmers, they are able to repay 

 their loans which, as servants, they were not. By dint of exertion and 

 thrift, they are even able to purchase a small piece of land and attain 

 the status of proprietors. Rich landlords, on the other hand, have been 

 losing ground. The sons by partition get only a fraction of their 

 patrimony, while their family and expenditure are, in many cases, equal 

 to, or greater than, those of their parents. They involve themselves in 

 debt and have ultimately to part with their lands. They become poor 

 and by hard necessity imderstand their position and try to lift themselves 

 with those who were originally poor. The lands are passing from 



* This seems to be too high an estimate. 



