El Paso herald. (El Paso, Tex.) 1901-1931, 1913-10-31

pity Tor the poor OF CODlenZ, ne or
gained a cooperative society for the
distribution of bread and potatoes
among them. The following year he
founded at FIammersfeld a loan So
ciety for the support of the unpro-
vided farmers, its members being rich
phiianthropists who sold cattle to IN
organized farmers at easy rates. In
1862 he organized a third society at
Anhousen, which went step further.
It's membership being constituted by
the borrowing farmers themselves
and thus was developed a rural credit
system that has carried aid to millions
Of farmers. and whose boast is that
10 man ever lost dollar in a Raft
feisen bank
The development of the idea was
first a charity organization to relieve
distress; followed by a philanthropic
Organiza ton to assist the farmer to
get back upon his feet: and then an
I organization of farmers help1ng them
selves and making themselves inde-
pendent.
In launching his system of farmers
banks Raiffeisen kept the moral as
pect constantly before him. He utiI-
lied to the full the one certainly in
tellSent power then to be found in
every farming district, the parish
priest or pastor With the help OF
the clergy. he touched in the peasant
| the golden chord of neighbOrly affec-
I ton and brotherly kindness, develop
the
village bank. In this bank every
thing was limited and restricted ex-
cept liability for the debts of the
! bank, and as to that every dollar of
every member was pledged to make
them good The territory in which a
bank could operate was restricted II
! that section where every member was
the neighbOr and business acquaint-
ance of every other member. in order
that none but responsible borrowers
and men of good habits could become
members; The time Of loan was r.
Stricted to a reasonable limit so that
changed conditions might not affect
IL; the amount OF the loan was lin
tied by the reputation and the needs
of the borrower: and the uses to which
it could be put were only those that
bade fair to allow the borrower 10
return the money without hardship
New source of Credit
With his system based upon hon
esty and thrift. Raiffeisen discovered
a new source Of credit.-the collective
liability of a considerable number OF
honest and thrifty people The sub
scribed capital of a Raiffeisen bank is
only nominal-there was none at all
until the government passed a law re
curing some such capital Now a
share is often sold for as little as a
dollar, and sometimes for IS little as
two cents The loan capital of one of
these banks is made up largely of
deposits made by peasants, who my
deposit as little as a mark at a time.
the smaller deposits Delng collected
BY penny stamp books, and although
the peaSantry uses the Raiffeisen
banks for the bulk of their savings
not a dollar has ever been lost through
The Raiffeisen banks make simple
loans. open current accounts. and
handle property transfers, though the
bulk of their business is the handling
of simple loans For these the Sc
curity is either a personal pledge or
a mortgage, the latter being used
venient to offer personal endOrsers.
But in such cases the mortgage IS
used only in lieu of personal endorse
ments, and is not made an instrument
for a long term loan as in the land
mortgage banks. In all cases the bank
insists on knowing not only the Dor
rover. but the purpose of the loan as
HELMS Peasants Get Land.
The property transfer business OF
the Raiffeisen banks is incidental and
is to be sold and subdivided. and
number of poor peasants want to get
a little tract of land out of IL, the
bank steps in. pays the seller his price
minus a small commission-and al
lows the buyers TO reimburse it in
small instruments for principal and
interest. Tt requires the prompt meet
ing of these instruments. thus encour-
aging thrift It thus keeps the buy
eTs out of the hands of real estate
sharks. who demand large commits
the buyer may default in the end
Sometimes these dealers force sales
lust a the time when the market is
most unfavorable. hoping 70 repur-
times the banks frequently step in,
buy the land themselves, resell it at
a favorable time. and generously re-
fuse to take advantage of the bar
gain. They restore the profit to the
man who was forced to sell, deduct
ing only the usual commission for the
service.
The Raiffeisen bank never has
pretentious place of business. 1t has
no handsome buildings with barred
it force of clerks discharging a con-
slant round of business, while direc-
tors interview special clients in room
apart It is usually located in a small
room. probably at the back of a farm
building, and is open only twice a
week. its routine presided over by a
single person-the accountant Busl-
ness is by no means brisk; now comes
a child with a few pennies to deposit,
now an old and palsied man, VINO.
signing with a cross, draws out lew
there is a meeting of the directors.
who discuss the credit problems that
have arisen since their last meeting.
The credit usually advanced by one
Of these banks averages around 500.
Loans can be called in upon a four
weeks notice, but this is seldom done
unless II appears Unat the borrower
is not putting his money to good use,
or is allowing his property to go to
the dogs and himself to drift toward
insolvency. The incubation of pune
tuality of payment as a moral duty
was the hardest of Raiffeisens tasks,
but it has proved his greatest trl-
umph.
Lives to See Ideals MateriaIiEe.
Father Raiffeisen lived to ripe old
age-lived to see his ideals of bank !
ing in behalf of the peasant farmer
become the keystone of German asri-
cultural conditions. and lived to see
his theories sweeping over all western
Europe and working with equal "a
cility in italian, Austrian. French, Bel /
gian and Swiss agricultural commune
ties. a monument to his memory now
stands in the village of his birth. and
two wonderful bits of sculpture there !
on tell the story of his service to the I
German farmer. One bas-relief shows
farmer and his family amid the
wreck and ruin of failure. The other /
shows another farmer with peace,
plenty and prosperity in his own face
and in the sleek cattle and the high /
stepping horses around him.
Tomorrow - The Schulz e-Delitzsch !
Banks.
EXAMINATION FOR SECOND
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