Omaha daily bee., 1915-05-15
Leaning to Persons
With Small Means

6AN2NNJ AN4NAA
a LONG lines previously tried out elsewhere. there
a was recently established IN New York bank
having for it's purpose the making OF loans IN
small SUMS on personal responsibility only This IN
sttution cones into direct competition with the much
exposed hut still thriving loan shark. 1ts
would be serious undermining OF the loan sharks
business Il aims 70 accommodate the man OF small
income who has hank account-thst lie. the
with an income OF from $40 to $40 week. Such
man when In need Of a loan OF from so 10 800
not set one from any bank merely his note,
though his note be endorsed by Of his
friends One reason IL the srnallness OF the amount
too little for the bank 70 bother with And yet this
poor mans note with its indorsers may quite -
good In It's relation TO the amount involved the
note OF some much larger borrower who. having
account with bank, with difficulty
loan Of some thousands OF dollars The man with
small income when pressed for $50 500 finds his
usual recourse TO be the loan shark, or lender
chattel mortgages His alternative Ia charity. but
seff-respectng in dislike OF accepting charity.
commonly resort 20 the loan shark and thus submit
to usury. third recourse which ought 10 Be open
TO hirn-tat Of credit At moderate rate OF interest
has been long closed
OF the operations of the hank recently established
N New York to meet the needs OF persons Of this
class. writer in the New York Times Annalst says:
Tho Same condition provailed IN continental Europe
up to sxty~five years ago. Now there 1900 IN
dustftd and other cooperative banks in Germany
doing total business Of nearly sSOoOooooo year.
In italy IN 1903 there peoples banks with
outstanding loans Of t1TO0O0o In France small loans
tnhnS ahOenln6 10 nunureos OF mlihonS annually.
the nrst EFFORT to provide similar banking naofll-
ties here was made fivs years ago. when Arthur j.
Morris put into operation q scheme he had worked
out. now known Ss the Morris plan This plan is
neither swindIe . philanthropy. II is strictly
on business basis ana the borrower knows that ne
u not relying upon charity paying excessive I'm
terest charge. but Is merely receiving the credit
which he is entitled and is paying fairly FOR the
accommodation.
rha 80 ~
Norfolk Va, Mr.. Morris home town. fifteen years
ago. Others followed. Several OF these are but
few months old. and their establishment followed the
formation OF central company which began business
last June This corporation organized to assist IN
starting MorrisPan banks In other cities where they
were felt 70 be needed II subscribes about 20 per
cent OF the stock each bank, the rest being taken
by local capital. and It supsrvses and helps in the
operation Of each. One OF the first new banks Il
established THAT In New York. which started
business December s., 1914. under the OF the
$4,000 On opening day, there eighty-three APP
picants for loans, on the second day more than
100 the third day 200 the fourth day between $50 and
200. ana on january II moro than 1000 During its
first two months. January and February, the COM
pany made 600 loans. agGrogRting SO, 7S0 average
Of rn-ss each. At the end Of that time there were
but seven deiinQuencies IN weekly payments, only
two Of which were for long week. OF the
borrowers ES were mon and 80 women. The average
weekly income Of the borrowers tH1o The
favorite amount for loans was $780, Of which there
we're 2Si Ia loans Of 80 were made.
The number of loans made by All the 1Eorris-Plan
institutions up to December 81. fsi6 was H6i6 The
average amount per loan was tlsS5a Losses from
bad credits have been ieus than one-tenth of per
cent In less than per cent OF the loans have the
indcrsers been called upon 70 pay anything Profits
OF the bank have been at the rate Of rs per
plan Of meling the loans IL simple The applicant
must furnish references to his character and must
give Information as TO his income He must have ut
least two indorsers comasers of situation and
come at least good ~ his For each so Dor
rowed he agrees to pay 81 a week for 20 weeks The
interest Is deducted In advance. that receives
but ~ Should he fail TO make a payment ON time
he Sc fined cents and notified OF his delinquency II
he gets q week behind his counahsru are notified
They may be relied up 70 see that he catohes IN
again n he can Should he fail to do 30, the CO.
makers take his placa In making the weekly pay
ments.
srho profits of 1Eorris-Pian company are derived
not only from lending ts capital but also from lend
ing the prepaid interest, the incoming payments and
money corresponding to depostS-for the plan Its
Investment a. well its borrowing side"
Since December. 1914 the list OF new companies
organized to operate under the Morris Plan has
Bridgeport and Worcester The Bridgeport company
was the twentieth 20 into the fiald It began
business on April 10. the Worcester company May
l. and company At Salisbury N. c.. ON May s. The
company IN Salisbury has capital of $4,000 the two
New England companies each 100000 Similar insts-
buttons will Be organised At Columbus, o. Wat
erbury Conn., and other cities Over U.Soo00o has
been loaned thus far. by fifteen Morrts-Pian COM
panies. TO over 5000 borrowers