Agricultural Finance & Co-operation. 242 



[March, 1912. 



year of nearly 40 per cent, in the number 

 of societies, of over 50 per cent, in the 

 number of members, and of nearly 60 

 per cent, of the working; capital. This 

 is remarkable ; it is a proof of past 

 enthusiasm and an earnest of future 

 progress. 



The Future. 

 The last observation with which I shall 

 trouble you is about the future. It is 

 stated from time to time in the Press 

 and elsewhere that this movement is in- 

 tended to fight the rapacious mahajan. 

 Even a Provincial Registrar a few years 

 ago suggested that the local money- 

 lenders were 9imply harpies, and were 

 utterly out of the question as sup- 

 pliers of capital for the "ural societies. 

 Epithets are dangerous weapons : is the 

 mahajan after all so rapacious ? The 

 late Sir Denzil Ibbetson, whose know- 

 ledge of the economic conditions of rural 

 life was monumental, once said that the 

 mahajans had been often unjustly abused 

 as a class, Whether he is called the 

 mahajan or the chetty or the sotvcar or 

 the Kaya, the agriculturist's financier 

 performs a definite function in the body 

 politic. It is futile to abuse him ; I do 

 not defend usury, but he is after all a 

 business man ; and when dealing with 

 individual debtors whose crops depend 

 upon the waywardness of a monsoon, he 

 has to charge high interest for low 

 security. What has to be done in rural 

 societies is to attract the local financier by 

 offering him moderate interest and good 

 security on the villager's joint credit, 

 and by freeing him from the necessity of 

 realising his dues by Civil Court decrees. 

 The money for the financing of the crop 

 exists to a great extent locally ; and 

 co-operative credit ought to get it on 

 easy terms with mutual advantage to 

 lender and borrower, Sir Harvey 

 Adamson, the Lieutenant-Governor of 

 Burma, has emphasised the same view 

 at the recent Burma Conference. He said 

 that the picture of the future is not the 

 elimination of the chetty, but his estab- 

 lishment as a_ banker on a sounder and 

 less speculative line of business, with 

 less risk of bad debts, and consequently 

 lower rate of interest. As societies band 

 themselves together into unions — a sound 

 course of development which official 

 advice is developing in Bengal, — the 

 security is strengthened, so that Govern- 

 ment aid, which in the early stage was 

 considered almost essential, is steadily 

 decreasing and should in time be entirely 

 unnecessary. In Bengal at the present 

 time less than 7 percent, of the working 

 capital is Government money. The 

 mahajan has been naturally hostile, as 

 long as he did not understand. I believe 



that if the movement is sensibly con- 

 trolled, the mahajan will in time to come 

 understand that his own best interest 

 will be served by financing local societies. 

 I am speaking of course of the pro- 

 fessional village money-lender ; there 

 are many in this country besides 

 mahajans who lend money. So my last 

 point is, do not consider the village 

 mahajans as ?in enemy, but as a local 

 capitalist with whom you expect and 

 desire to do mutually satisfactory 

 business, 



The Year's Results. 



The Presidental speech* over, various 

 organisers made statements of the pro- 

 gress made during the year; The 

 Registrar then summed up the develop- 

 ments. He showed how the number of 

 members of societies of all kinds had 

 risen from 511 to 800 up-to-date. The 

 membership had increased from 22,000 to 

 36,000, and the capital from 7 to 12 lakhs. 

 A great progress had been made in 

 established area. Seven new areas had 

 been opened and they were promising 

 well. He concluded by emphasizing the 

 necessity for more unofficial organisation. 



The report of the Sub-Committee on 

 Village Banks was then presented. It 

 included the recommendations to be 

 adopted in forming societies, in internal 

 administration of societies, on the nature 

 of security for loans and the principles 

 of repayment in instalment. Several 

 instances of the moral effects of co- 

 operation were cited. 



The Conference next discussed the 

 revised by-laws of rural societies. 

 The Sub-Committee.on Central Banking 

 Unions, then presented its report which 

 showed the great progress that had been 

 made by the life unions in the province. 

 Ths success obtained by the experiment 

 in centralisation was held to justify 

 further trials on a wider scale. 



The Conference then proceeded to 

 discuss the best methods of financing 

 societies in North Behar. 



An interesting discussion then followed 

 on Share Banks, in which several 

 representatives from Calcutta societies, 

 including Mr, Kirkpatrick of Messrs. 

 Bird and Co., Mr. Stevens, of the 

 Custom House, and Mr. Smail, of the 

 Port Commissioners, took part. 



The Conference accepted the principle 

 that the borrowing power of the society 

 should be limited by a rule, and that the 

 dividend on shares should also be limited. 

 Conclusion op the Session. 



The Conference resumed its sitting at 

 11. a.m. on the 1st August, under the 

 presidency of the Hon. Mr. J. G. Gum- 

 ming. The policy at present pursued in 

 financing societies was first discussed. 



