SMALL LOANS FOR POOR PEOPLE.
[To THE EDITOR OF THE "SricorATog."]
Sia,—From several cases recently reported, it appears that County Court Judges regard 60 per cent, as a not unreason- able rate of interest on small loans, even "where sufficient security is given." Very little inquiry will show how common, how unavoidable, and how crushing such transactions are among the class known as the lower middle, which in temporary exigencies has no resource but the professional moneylender. It seems anomalous and impolitic, while pro- viding old-age pensions, to allow a large class on whose honesty and work so much depends, to be ruined by such causes. No doubt legislation or judicial interference with the contractual rate of interest is open to objection on economic and other grounds. Equally grave objections would arise to State loans and to private charity as alternatives. Such modes of relief would demoralise and pauperise the borrowers unless in each case strict inquiry and repayment were required. And the necessary inquiries would be almost impracticable and recovery uncertain and odious, alike for the State and the individual lender. The same objections would not apply to an Association for the purpose. So far as I can ascertain, no such Association exists. There may be societies which make loans to limited sects or to members already qualified by subscriptions. But what is needed, I submit, is an Association with wider scope,—an Association which would aid, by small loans on reasonable terms (say 9 or 10 per cent.), solvent but struggling families to tide over unexpected pressure. The offices of such an Association should be as well known and as accessible as the parish church, and its affairs might with care and time be self- supporting. Is it hopeless in a country of enormous wealth and with a numerous leisured class to ask if there are any who would join in starting such an Association? Co-operative banks are common all over the Continent, and are now on their trial in India. They are worked, not in the manner of a Mont de Piet& but by committees of members, who give a little time and trouble to make the necessary inquiries and to insist on recovery by moderate but punctual instalments. In the earnest hope that you will not refuse space for this appeal, and that some among your readers may join in starting such an institution or suggest a preferable remedy, I am, Sir, &c.,
HERBERT BA.TTY, Late Judge of H.1111.'s High Court, Bombay. Cornbe Grange, Monkton Combe, near Bath.
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