New Britain herald., 1930-03-11
Professor at Wesleyan De- clares Lower Rate Pos sible With Profit - Un- able to Obtain Figures On Net Gains - Sees Room for Improvement.

Calling attention to the fact that interest rates of 4 per cent have been sanctioned by law. Prof. Clyde Olin Fisher of Wesleyan University. who spoke last night at the home of Mrs. Emory Corbin before the Wo- mems college club, suggested that the small loan problem be studied with an attempt to modify or amend the present small loan act permitting such rates. Claiming that the operation Of finance com- panies dealing with this type of loan creates a state of affairs where 6U per cent of those availing them selves of this opportunity become habitual borrowers, Dr. Fisher, at tacked both the law creating sucn & condition and the companies talk ing advantage of 1t.
 His attention was first called 70 the small loan situation when he re- ceived a letter from one of the finance companies operating ill Mi l. dletown, the letter indicating th.t the company was licensed by the state and bonded to the public. Upon further investigation he foun that the rate of interest was 3 E per cent per month or 42 per cert per year, on sums not exceeding $500.
 My first reaction" ne said. twas naturally that of an outraged sen Sc of justice at having placed on thts rate of interest for necessitous bor- rowers, the sanction of law"
 Law on Books for 10 Years
 Dr. Fisher claimed that law was drafted in 1916 and almost at once adopted by IS states with few modifications, allowing finance companies to set up in business and loan money at A prr cent interest. Through the activities of the Russell Sage Foundation, which was the original sponsor of such 8 law, he declared, the small loans act was passed in Connecticut in 1919. "The law has been on the statute books for ten years and it is high time that it's benefits were studied" H2 said. When the first move was made to create such a law members anl representative of welfare organiza- tions appeared before the investi- gating committee and advised it's passage, claiming that there comes a time when a man has sickness, n gtt1 lT- 1 and if he is in a place like Con- necticut he has no place to go ex- cept to charity
 Room for Improvement
 Dr. Fisher admitted that such a law probably has saved the con- munity from the greater .eyil of lola sharks, but there is yet room for re- Gnement and improvement in it. \ study of the operation of the la v in Connecticut based as it is on in- complete data because of the ab. sence of full publicity, leaves one III doubt as to the wisdom of continu- ing the law on the statute books"
 It is impossible to find any lH- formation regarding the activities ot the loan companies he said, and no one can tell what the profits of the companies are. All of his efforts 10 penetrate behind the veil of mystery surrounding the operations of these companies have met with "it is none of your business" he said lu 1923, 35 companies throughout the state loaned s1,000,000; in 1924, 57 companies loaned S2,e4O,S09; n 1927, go companies loaned $4643,- 511, and in 1928, 12S companies loaned s5,942.229.
 Lower Rate in Massachusetts
 In Massachusetts where there .5 a per cent law in effect, 133 li- censed companies loaned S17,414, 140, or a far greater business in proportion to those in Connecticut tor the same length of time.
 He claimed that the lower rate oi interest in the neighboring state brought in almost rnree times the revenue that slightly fewer com panies in Connecticut had. The fact that such companies have met with so great success in Connecticut makes it apparent, he declared, that