Miscellaneous. 



420 



[Nov. 1906. 



The capitalist does not know which cultivator is good for Rs. 5 and which for Rs. 100 ; 

 he does not know who requires Rs. 20 to finance him and who requires three 

 times that sum ; he does not know who is already hopelesly involved and who 

 can repay. It is the villagers alone who have all the information. On the other 

 hand, the capitalist can see that the whole village is good for the total sum required. 

 The ryots take the responsibility for dividing the money, of collecting principal 

 and interest, and of keeping the separate accounts. This organisation of credit 

 must be the bed rock on which any system of agricultural finance is based, and 

 wherever a village exists, it Avill be found that. the ryot's'credit in his own village is 

 better than his credit anywhere else. The individual may have a character for 

 honesty in his caste, but his credit in his village will be greater than his credit 

 with his caste. 



There is no doubt that in this we have the germ of a solution of this great 

 financial problem, but the question remains how to provide against the evils of 

 facile credit. By organising the village and making the members jointly and 

 severally responsible, we create a check on excessive expenditure and prevent 

 the individual from robbing his children. The village will not lend to the individual 

 unless they see a prospect of the money being repaid within a reasonable time, and, 

 moreover, they will not lend unless they consider the expenditure necessary. A 

 man is not tempted to spend on display more than he can afford when he has to 

 run the gauntlet of public opinion, and the village will not lend him more than 

 he can repay when they realise their joint responsibility. Further, there are so 

 many necessary uses to which the members can put the money that they will not 

 "•ive out the money for unnecessary expenditure, and if the member turns to, 

 the money-lender again, his name is removed and the privilege of borrowing at 

 a low rate ceases. 



There are at present in Bengal eighty-six experimental village societies, and 

 the majority of these show every sign of ultimate success. These pioneer societies 

 are distributed over twenty-two of the thirty-two districts in Bengal. The capital 

 has been raised partly from Government and Wards' Estates and partly from private 

 sources. The societies pay from 6 to 12i per cent, for the money borrowed, which 

 they lend again at from 12| to 18| per cent. The whole of the profits go to a village 

 fund from which the original capital borrowed will be repaid, and the village will 

 then be in a position to carry on their society with a capital of their own sufficient 

 for all ordinary seasons. Working on these lines, steady progress has been made 

 during the last eighteen months. Wherever a village community can be found, the 

 scheme will succeed, but in parts of Eastern Bengal where the cultivators do not 

 live in villages, some modification will probably be necessary. The societies have 

 been found in villages which are not heavily indebted, because they offer the best 

 field for initial effort, but as soon as the neighbouring villages see the benefit, they 

 also demand similar societies in order to pay off- their debts and start afresh. At 

 present the societies are small, with a capital of Rs. 200 to Rs. 300, which is often 

 sufficient to finance a small village, and such little societies are the best ground for 

 observation and experience. 



Three grain banks, run on co-operative lines by a zemmindar of Dacca, have 

 attracted much public interest, and it has been recommended that such golas 

 should be opened all over the province. The question of establishing grain golas is 

 one of some difficulty, and so far only two have been registered in this Province. 

 The price of grain ruled high this year, so that those with surplus stocks were eager 

 to sell, While those with short crops had nothing to deposit. A grain bank requires 

 much supervision, and it seems impossible to run it in Bengal as anything but a 

 store of food grain. The different varieties of paddy sowxi by the culti vators of a 

 single village are so numerous that the individual cannot rely for his seed upon the 



