RURAL FINANCE

Hokitika Guardian, 21 March 1931, Page 7

RURAL FINANCE

INTER M EDI ATE CREDIT. CHAIN OF ASSOCIATIONS. Reporting on action taken to ; furthe tlie formation of rural credit assoeia tions through the Dominion, Hr J W. Macdonald, Commissioner of Rura Intermediate Credit, informed member of the board at the monthly meeting held in Wellington that the assoeiatioi method of obtaining finance was prov ing increasingly popular. The completion of a chain of assoeia tions throughout the Dominion was the object which the board had in view, an< it was interesting to note that at the present time there were 40 associations formed, of which 39 were in a position to make loans, while the other would ho in a position to do so immediately its statutory meeting had been held. “A marked feature of the system at the present time is that the hulk of lending business is being done through associations,” Mr Macdonald said. “Only a very small proportion of the loans now granted ajre made supported by guarantees. “By granting preference to loans which have' for their object the increasing of production as opposed to the discharging of existing liabilities, the hoard has been able to render considerable assistance to farmers in increasing their returns to enable them to meet their commitments at present when prices for primary produce are low, and it is anticipated that as the production season draws to a close in erased demands will he made upon the board for finance to enable farmers to rvchase stock and effect improvements in order again that production may he increased. “The hoard’s experience witli borrowers has proved exceptionally satisfactory, and the payments to the board have lieen well maintained, more especially as in the great majority of cases the annual repayments were fixed when farmers were receiving higher prices for their produce. Tt has been recognised, of course, that owing to the drop in prices it is necessnrv to meet borrowers wherever possible in regard to repayments required from them, and all applications for revision of the basis of repayment of loans have been dealt with as sympathetically as possible hearing in mind the fact that the interest of the hoard’s de-benture-holders must be fully protected.