IOO AGRICULTURAL CREDIT BANKS 



e.g., at marriages, almost compulsorily extravagant, 

 found they had become possessed of what was for their 

 position in life large credit. They used it foolishly, and 

 once a man was on the books of the local usurer he 

 found himself on a slope, at the bottom of which was a 

 slough of despond consisting of a practically irredeem- 

 able mortgage of his holding. Fourteen years ago the 

 Government took its courage in its hands and put severe 

 restrictions on alienations of land to persons not belong- 

 ing to agricultural tribes. 



For many years the Indian Government has offered 

 loans for agricultural improvements at a rate of interest 

 sufficient to secure itself against risk of loss. The usual 

 rate is 6J per cent. Such State loans are known as 

 takdvi. They are secured by the mortgage to Govern- 

 ment of a sufficient part of the borrower's holdings. 

 The periods allowed for recovery are ample. Large 

 powers are taken to enforce repayment; but it is only in 

 the rarest instances that resort to them is necessary, and 

 takdvi is generally recovered with ease and regularity. 

 The amount advanced in the Punjab in a recent year 

 was 22,000. Contrast this with the sum of 414,000 

 lent to members by credit societies in 1912-13. 



The first Indian Act relating to Co-operative Credit 

 Societies was passed in 1904. It was superseded in 1912 

 by an Act dealing with co-operative societies of all kinds 

 having for their object " the promotion of the economical 

 interests " of their members. It follows orthodox lines, 

 but no attempt has been made to force into one mould 

 societies spread over a vast territory inhabited by 300 

 millions of people of the most diverse creeds, characters, 

 and social conditions. Here it is only necessary to notice 

 one or two points affecting village agricultural credit 

 societies. Societies are to consist of ten or more persons 

 residing in the same town or village above the age of 18. 

 The liability of the members is unlimited unless the 

 Local Government otherwise directs. Loans may not be 

 given on the security of movables without the sanction of 

 the Registrar, and the Local Government is empowered 

 to forbid or restrict loans secured by mortgages of real 

 property: 25 per cent, of the profits must be credited to 



