Evening star. [volume] (Washington, D.C.) 1854-1972, 1895-07-01
LOANS AT LOW INTEREST
Proposed Association to Help the Worthy
Poor.
Results of MIR. DOnath's Inquiries
Success of Similar Efforts in New
York and Boston.

number of business men are seriously con-
sidering the feasibility of forming an asso-
ciation the object of which shall be the loan
ing of money to the worthy. poor on such
security as household effects, pianos, &C.,
with the view Of saving them from the 10
per cent month men. Mr.. August Do
nath who has been deputed by his asso-
ciates to ascertain the methods of business
Iracticed by similar associations in other
cities, and the measure of success with
which they have met, gave to Star re-
porter today some account of the results of
his researches.
Il feel convinced" said Mr.. Donath. "that
we have here a wide field for as practical
charity as has ever been organized for
the relief of worthy people. At the present
time there is simply one avenue that leads
such needy borrowers to the source of sup
ply, and that is the loan company or indi-
vidu2l who not only exacts 10 per cent a
month for interest but who also charges
heavy fees for various items such re-
cording, &c. AS result of my inveStiga-
tions believe that money can be furnished
On the security mentioned at living rates.
Muy Pay Per Cent Dividends.
my firm conviction is that if the con-
trihutors to a capital stock of, say. $4,000
will be satisfied with dividend of 4 per
cent per rnum, we can furnish money at
| mum. OF course, each loan must be care
fully considered and the disbursement Of
every dollar be fully weighed; but if the
management is in careful and business
like hands feel safe in stating that money
can be loaned on household chatteis at 10
per cent per year. OF course, if stockhold-
ers demand a return of 6 instead of per
cent the charge would have to be made II
per cent but tf at. you see, would make US
guilty of usury-just what we wish to
break down.
I'm New York city, according to a letter
I have received from Rev. DR.. Greer. an
organization has loaned money on just
such security as We propose taking at II
per cent per annum. A small surplus has
been earned over expenses. But still
more convincing proof of the feasibility of
the enterprise is furnished by the history
of the Worl<ingman'S Loan Association of
Boston, Mass For seven years this asso-
citation has loaned on household furniture
1t charges l per cent per month. besides
small fee for appraisal and recording. Each
year, after the first twelve months, the
company has paid dividend of per cent
on its stock. has paid expenses for salaries,
etc, amounting last year to over $1,000, be-
sides 4 state tax of $1,000, has each year
added modest sum to its surplus fund.-
and has today more customers than ever,
while the capital now employed Is over
S115O00. Its losses from bad debts are also
reported as very small, and Its success
seems to have been fully as great-yeS
greater-during the hard times than be-
fore. OF course. this company is conducted
on strict business principles, just as our
proposed organization must be.
'1f we charge 10 per cent per year on
loans, We can pay stockholders a dividend
of per cent, ana meet all expenses out of
the per cent surplus.
Business Methods May Do 1t.
What business methods can accomplish
in Boston business mthods can accomplish
tere While our field of operation will be
smaller, our capital less, our expenses will
be correspondingly reduced. The expert
ence of the Boston association removes this
enterprise from the realm of speculation.
The same methods produce the same re-
suits. Let the enterprise he in practical
hands, and these results Will flow from It,
The needy borrower can be helped at
rate of interest that does not mean certain
the capital have the satisfaction of COM
bining practical charity with safe per
cent investment, and the formation of sim
liar enterprises. supplying demand which
our small capital cannot meet, will surely
follow.
II see that The Star suggests. as round
ing out the project, liberalizing of pawn
brokers' methods for the benefit of the
poor. Unquestionably, great good would
result from pawn shops for the poor on
similar basis to that of our proposed asso-
citation, and one or more of the city's pawn
brokers might well respond to The Stars
sugge stion. AS for ourselves. If we accom-
plish what We have set out to do in
limited field we will be satisfied. We do
rot wish to cover too much territory at
the start. Let us form this company. Let US
demonstrate that good can be accomplish
ed and money returned on the investment.
and others will aid in spreading the good
work l am more than pleased to see The
Star show live interest in the matter. 1t
is in line with it's past glorious record.
There has never yet been an enterprise
started fer the benefit of the worthy poor
bot no Cfnv har ,ot 1,,rt tt,x II
and it's generous means, aided in the work.
l am glad you with US in this"