Miscellaneous. 



416 



[Nov. 1906. 



Provision ha,s been made in the model by-laws that in the years ot scarcity or 

 crop failure, or in any individual case in which the compulsory deposit would mean 

 hardship to the depositor, the punchayat shall have the power to remit or postpone 

 the deposit. Where general remission is sanctioned by the punchayat the fact must 

 be reported to the Registrar for his information. It is permissible to hope that this 

 provision, while preventing hardship in years of scarcity, will at the same time 

 counteract the temptation to remit in years when general remission is not called for. 



The two great problems which at xjresent confront the movement are the 

 illiteracy of the lower castes, for whom co-operation is specially fitted and specially 

 necessary, and the absence, under existing conditions, of any connection between 

 the co-operative credit societies and the joint stock banks. Efforts have been 

 directed towards the solution of these problems and a method evolved, which seems 

 to overcome the difficulty in each case. The outline.-s of these methods were origi- 

 nally sketched by Mr. Winter (at present Chief Secretary to the Local Government) 

 in a note dated the 21st June, 1902. 



The illiteracy of the lower castes is such, that it prevents any possibilities of 

 independent societies, owing to the inability of members of such societies to keep 

 their accounts. At the same time it is obvious that the lower castes are not in a 

 position to command sufficient assistance from literate members of castes above them 

 in the social scale. Any scheme by which the lower castes can be admitted to the 

 benefits of co-operative credit must then have as an essential feature the removal of 

 account-keeping from the sphere of the village societjr. The existing difficulty in 

 bringing village societies into touch with the joint stock banks chiefly lies not in the 

 want of tangible security, but in the smallness of the amounts with which such 

 societies deal. Even with the most reliable security, it would not be paying business 

 for a joint stock bank to advance a couple of hundred rupees, repayable in 

 instalments spread over a considerable number of years. If, however, the village 

 societies could be induced to combine for the purpose of taking loans of a con- 

 siderable amount, there is every reason to believe that it would be possible for them 

 to obtain such loans from the joint stock banks at a reasonable rate of interest. 



The realization of the above two facts led in the first instance to the experi- 

 ment of Central Banks to which village societies were affiliated as branches. There 

 are now five or six such institutions and their branches number some 55 or 60. The 

 process of formation was by fission of certain existing village banks, whose members 

 had been recruited from many castes resident in several villages. The new societies 

 were confined to members of the same or allied castes, and to residents of one 

 village. In this reconstruction, it was inevitable that certain of the members of the 

 original society could not, owiug to their caste or residence, be included in any of 

 the newly-formed small societies. To such members their initial entrance fee was 

 returned, and their connection with the society was severed. The small societies 

 having been formed, the members of their punchayats, or in cases where the number 

 of the societies was considerable, their sarpanches became e.r-omcio members of a 

 Central Society. Tbe sole duties of this Central Society are to raise money on behalf 

 of, and keep the accounts of, all the affiliated societies. The method of working is 

 simple. When the Central Society is instituted and afterwards once a year, at its 

 annual general meeting, the maximum credit to be allowed to each one of the con- 

 stituent societies is fixed. This amount is recorded. Thereafter the sole duty and 

 responsibility, that rests with the punchayat of the Central Society with refer- 

 ence to loans, are to see that the amount so fixed is at no time exceeded by any 

 society. With the internal arrangements of the affiliated societies the punchayat 

 of the Ceutral Society has nothing to do. All applications for loans and all amounts 

 in repayment, come up to the Central Society through the punchayats of the 

 affiliated societies, and from the lists of payments, or lists of applications for loans, 



