!Page Two
THE CAROLINA UNION PARMER
[Thursday, August 8,
Agricultural Co-operation
By CLARENCE POE
In Ireland
u.—Co-operative Credit Societies and Why zve Should Have Them
in the South.
I next visited Mr. John Brett, Sec
retary of the Ballyragget Agricultural
Bank. I found in Mr. Brett a sturdy,
stubby, good-natured Irish farmer
and ex-schoolmaster, whose thrift
has brought him in his age into pos
session of one hundred acres of land
—a pretty large farm in Ireland.
Moreover, the Ballyraggett inn-keep
er informed me that he also gets a
pension as a retired school teacher,
he having served full thirty years, 1
believe, in the school-room, and the
British government, unlike ours, hav
ing acted on the theory that it is
just as sound policy to pension teach
ers who make life more abundant as
it is to pension soldiers who destroy
life. As we walked through his
fields, Mr. Brett told me of the work
ings of the Agricultural Bank, and
then took me to his little farm-house
to show me the “books.”
“Surprised Entoirely.”
The story of its growth is interest
ing, and Mr. Brett confided to me that
when he recounted it before a pub
lic committee in Dublin recently,
they were “surprised entirely.” I
doubt not, too, that many of our
Southern farmers will be “surprised
entirely’ ’to find out how much supe
rior are the banking facilities these
Irish farmers have worked out for
themselves as compared with our
own.
Here is the story in brief: In 19 01
Mr. G. W. Russell, editor of the Irish
Homestead, went down to Ballyragget
and told them how to proceed with
their oranization. There were about
fifty members to start with; they fix
ed a six-shilling ($1.44) entrance
fee; elected the parish priest as presi
dent; named an executive committee,
and pledged their joint credit to get
a loan of £100 ($486) from the Gov
ernment. On this loan they paid ki-
terest at the rate of 3 per cent and
lent money to the members at 5 per
cent. Another point that must always
be kept in mind is this: money is lent
to members for productive purposes
only. That is to say, no money is
lent to a man merely to keep him go
ing the even tenor of his way, but
only to help him go forward—to help
him buy stock, or make some im
provement, or take advantage of some
other safe and profit-promising farm
investment.
One does not put up collateral to
secure a loan, but he must have two
solvent sureties to sign with him. And
here is the keynote of the whole sys
tem: from beginning to end it is
based on the principle of co-opera
tion, that the members must help one
another, believe in one another, and
join together in a movement for the
common uplift. The members of the
bank are jointly liable for the safety
of the money it borrows or receives
as deposits, and two persons must en
dorse with the borrower for every
loan.
A Dilferent Sort of “Bank.”
Perhaps, too, it may be as well to
explain just here that while it is call
ed a “bank,” it is very different from
the banks we are accustomed to see
ing, it being, in fact, only a farmers’
mutual credit society, with one of
their number as cashier keeping the
books in his own home. There is
no expensive office to maintain or
rent to pay, and about the only ex
pense incurred is a nominal sum for
bookkeeping and the annual examina
tion of the books by an expert audi
tor from the city. The executive com
mittee meets once a month to consid
er applications for loans and to see
that all notes that have fallen due are
paid. The members who have sur
plus funds may deposit them in the
bank and receive 3 Vz per cent inter
est.
It is not presumed that there will
be much idle capital; the outstanding
loans should about equal the capital
and the deposits; but in case of sur
plus, it is invested in Government
bonds or deposited in the postai sav
ings bank or other interest-paying
financial institutions.
The first year the Ballyragget Co
operative Bank received no deposits.
“The people would not trust us then,”
Mr. Brett told me; but now the bank
gets more money than it can handle,
although it has reduced the interest
paid on deposits to 3 per cent. In
stead of the £100 ($488) capital
with which the bank started, it now
has capital and deposits aggregating
thirteen times as much, and it has ex
tended its influence from, a three-mile
radius to the five-mile radius.
When Money Cost 12 Per Cent.
The good this bank has accomplish
ed in the community is almost incal
culable. The farmer members now
borrow money from it at 5 per cent
besides getting back the profits the
bank makes, and they can borrow for
a period of twelve months in case the
money is needed for so long a time.
Before the coming of the bank, these
Ballyragget farmers had to go to Kil
kenny, the county-seat, pay 6 or 7
per cent for a loan, take two secur
ities with them and feed and treat
these securities, and go through the
same expensive proceeding to get the
loan renewed at the end of three or
four months—if they could. With
such a system, of course, few farm
ers got the benefit of small sums
when they really needed them, and
the cost averaged 12 per cent or more.
Now all this is changed. If the far
mer needs $10 to $100 for a really
productive purpose, he simply gets
two of his neighbors to sign with
him; gets the money from the Agri
cultural Bank at 5 per cent, borrows,
if necessary for a longer period than
the city banks would have lent to him
and has no embarrassing red tape to
go through with.
Five Advantages of the Co-operative
Bank.
Or if an exact summary of the ad
vantages of these small co-operative
banks is wanted, let us say:
(1) The farmer gets small sums
when needed, such as he would not
trouble a city bank to borrow.
(2) The higher interest rate and
the expenses of sureties, investiga
tions, etc., formerly made most bank
loans cost him 12 per cent, whereas
this cost is cut in half under the co
operative system.
(3) The city banks will lend for
only three or four months (our whole
banking system being built to meet
the city man’s needs), while the agri
cultural bank recognizes the fact that
in farming one must frequently bor
row for twelve months or not at all.
(4) The simple operation of having
two solvent friends or neighbors en
dorse one’s note prevents the neces
sity of putting up collateral or mak
ing a mortgage, besides stimulating
brotherliness and co-operation; and—
(6) Limiting loans to those made
for productive purposes, prevents the
bank from being imposed upon by
shiftless farmers, and prevents any
farmers from tying up or losing their
estates through miscellaneous bor
rowing.
Some Practical Exhibits.
To illustrate more fully what this
particular bank is doing, let me men
tion some of the loans as I found
them in Mr. Brett’s books. First,
there was a loan of $125 for twelve
months to enable a certain farmer “to
hold over stock for a better sale”;
then a loan of $60 for twelve months
to help some one buy a cow; $25 for
twelve months, “to purchase a grass
take to graze a horse”; $60 to buy
two calves; $45 to buy seeds and fer-
tilTzers; $70 to buy calves; $10 to buy
two pigs; $100 to buy young stock;
$35 to buy a heifer; $12.40 ($2.40
payable monthly), to buy small pigs,
and $20 to enable a farmer to hold
over cattle.
The minutes of the meetings show
that business is done very carefully
by the committee members who meet
monthly and pass upon the applica
tions, knowing that their credit is
pledged, as well as that of other
members, for the solvency of the so
ciety. Notice these typical entries:
“Thomas Lacy £6 to buy a horse,
granted”; “Michael Murphy, £7 to
buy two calves, granted”; “William
Phelan, £12 to buy a cow, refused, as
one surety was objected to; granted
on condition that two solvent sureties
can be obtained.”
Another meeting: “Mr. Michael
Clancy’s loan of £9 was overdue. He
attended and offered £2 on account of
interest. The £2 offered was not ac
cepted. He was ordered to pay the
full sum or proceedings would be tak
en at the quarter session for the re
covery of the loan.”
Again: “Michael Downey attend
ed and obtained a further time for
two months for payment of loan.
Thomas Lacy, ditto, till he could sell
his barley.”
How the Bank Helps the Farmers.
And so it goes. Men thus have the
opportunity of borrowing who could
not borrow from an ordinary bank,
and the loans to the farmers have en
abled them to make and keep many a
shilling in the neighborhood. “We
lend a man, say £15 to buy a young
cow,” said Mr. Brett, “and he pays
15 shillings [5 per cent] interest and
at the end of a year has a cow worth
£18, and a calf besides—all for the
sake of the 15 shillings.”
The Ballyragget Agricultural Bank
does business on such a narrow mar
gin that its profits no year have ex
ceeded $25 or fallen below $5. A
few dollars a year to Mr. Brett for
bookkeeping covers the entire official
expense, and as his home is the of
fice, there is no charge for rent. I
notice, however, that Sir Horace
Plunkett, in his latest President’s ad
dress strongly advises that these co
operative banks should not attempt to
lend money at too low a rate—espe
cially in view of the fact that any
profits will go as reserve fund in
which the members are equally inter
ested—and that 6 per cent rather
than five should be the normal rate.
No loans are made for over $150.
Originally the maximum was $50,
but this amount was soon raised to
$75. Ninety loans were outstanding
New Year’s Day aggregating over
$4,000.
Another Co-operative Bank.
I also paid a visit to the Castle-
comer Credit Society, or Agricultural
Bank, which I found in no less flour
ishing conditon than the one at Bal
lyraggett. All these banks operate
■ on the same general principles, so
the rules of the Castlecomer Society
are practically the same as those I
have given for its neighbor. It has
existed for twelve years and “neither
lost a penny piece in bad debts,” as
tlie Secretary, Mr .Joseph Tobin, told
me, though, of course, it has had to
resort to proceedings once in a while.
January 1st its capital consisted of
about $3,800 borrowed at 4 per cent,
and $2,000 in members’ deposits,
bearing 3 per cent interest, prac
tically the entire $5,800, total, being
loaned out to members at 5 per cent.
Only two loans were overdue and
these have since been repaid. The
entrance fee is one shilling, and there
are 278 members. The maximum
amount that can be lent any one per
son is $100; and there is a fine of 15
per cent for allowing a loan to be
come overdue. The annual turn
over grew from $1,250 the first year
to $2,000 the second; $3,000 the
third; $4,000 the fifth, and $6,000
the sixth, and is now $10,000.
In addition to all the usual society
books and records, such as I found
at Ballyragget, Mr. Tobin showed me
an alphabetical index which indicates
at a glance whether or not a member
has money borrowed or is surety for
a borrower, and enables the executive
committee at its monthly meeting to
determine immediately whether or
not any member should be accepted
for a further loan or as a surety for
another borrower. And the success
of the Castlecomer Co-operative Bank
in aiding the farmers 6f the commun
ity has been no less marked than in
the case of Ballyragget.
“I know many members,’ said Mr.
Tobin, “who pay back the money at
the end of the year out of the profits
made on the original loan and have
the loan money clear.”
(Continued next week.)
LITAIiBR. UNION PICNIC.
There will be a picnic of Litaker
Union at W. N. Isenhours, in No. 11
township Friday, August 9th. Every
body is invited to come and bring
well-filled baskets. Refreshments
will be served by the local.
W. F. LITAKER,
President.
ANNUAL PICNIC OF CABARRUS
FARMERS’ UNION.
The annual picnic of Cabarrus
County Union will be held at Harris
burg August 21, 1912. Everybody is
cordially invited to come and enjoy
the day.
J. L. D. BARRINGER,
President.
L. A. LIPE,
Secretary.
The Lee County Farmers’ Union
will meet at the court house Satur
day, August 10th, at 10 o’clock a. m.
for the purpose of transacting im
portant business and to select a place
and set a date for holding a picnic.
Every local is requested to send dele-*
gates to this meeting.
Our subscribers who raise sheep
will be interested in the offer of Chat
ham Manufacturing Company, of El
kin, N. C. (See page five) to ex
change their fine blankets for wool.
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