INDEBTEDNESS. 
9295 
fact in one case the rate of interest reported was as high as 225 per cent.” 
The prevailing rates of 12 to 24 per cent are low by comparison with 
other places, and may, we think, be attributed to the fact that a large 
proportion of the workers reside permanently in Ahmedabad or the 
adjacent areas. The enquiry made for us into the standard of living in 
certain towns of the Central Provinces states ‘ Rates of interest on debts 
show that 25 per cent per annum is the most usual rate charged, and by 
far the largest amount of loans is incurred at that rate. But interest as 
high as 150 per cent, 5.e., two annas per rupee per month is not unknown 
and is generally exacted by the Kabuli money-lenders. The commonest 
term of such loan is the sawai system (i.e., with 25 per cent interest) 
which requires that 1} times the money borrowed should be repaid with- 
in one year, and if it is not repaid within the stipulated time, compound 
interest is charged.” As already observed, the system last described 
involves the payment of interest at a rate much larger than the apparent 
one. The Bombay Working Class Budgets Enquiry of 1921-23 gave the 
usual rate of interest as one anna in the rupee per mensem ; a recenf 
enquiry which was much more limited in scope states While in a 
few cases no interest had to be paid on the money borrowed, at least in 
one case the rate of interest was as high as 150 per cent. In 29 per 
cent of the cases the rate of interest varied from 72 to 78 per cent and in 
19 per cent of the cases it varied from 24 to 30 per cent.” This relates 
to families ; of 49 single persons in debt, the report observes, ““ The most 
usual rate of interest is from 18 to 30 per cent, although in 14 cases it 
was as high as 75 per cent.” The enquiries made for us into the 
standard of living in the United Provinces give 75 percent as the com- 
monest rate at Cawnpore, the next commonest rate being 37} per 
cent, In Lucknow and Gorakhpur, the higher rate is exceptional ; this 
appears to be due in part to a number of the workers being members 
of co-operative societies. The enquiry made for us intc the standard 
of living of jute mill workers in Bengal gives the average rate of 
Interest at 78 per cent. The report on this enquiry and the evidence 
given to the Bengal Banking Enquiry Committee by the Indian Jute 
Mills Association both mention as the highest rate 325 per cent annually 
(one anna in the rupee weekly) on small sums. Rates in the Punjab 
Appear to be much lower, but particulars are not available to distin- 
guish loans by money-lenders from loans by co-operative societies, and 
here, as in other places, low rates seem to be associated with repay- 
Ment by monthly instalments. The enquiry: made into the standard 
of living on the South Indian Railway states “ More than 80 per cent 
of the loans are obtained from money-lenders whose usual rate of interest 
ranges from one anna in the rupee or 75 per cent to two annas in the 
fupee or 150 per cent.” 
Payments on Debt. 
Actual payments are seldom on the scale which strict fulfilment 
of the terms of the loan would require. The prompt repayment of the 
“apital is not usually desired by the money-lender ; he prefers to remain 
a creditor and receive interest, and in most cases he does not receive