226 CHAPTER XIII, 
the full amount of interest with regularity. But defaults are recorded 
and go to increase the liability, so that the borrowing of a trifling sum 
can, and not uncommonly does, lead in a few years to a permanent and 
heavy load of debt. In a number of cases a stage is reached when the 
money-lender takes from the worker the whole of his wages, paying 
him only sufficient for subsistence, and even puts the members of the 
worker’s family to work on a similar basis. The statistics which are 
available of the actual payments by workers are even less reliable than 
those of debt and liability for interest; one anna per rupee of income 
for those indebted is a conservative estimate of the average payment ; 
one month’s wages in the year is probably a more accurate guess. All 
these figures can vary widely from industry to industry, and from centre 
fo centre, and the variations in individual cases are very large. But 
whatever the figure, the result is almost invariable ; the indebted worker 
has to give all of what might otherwise be his savings to the money- 
lender, and these payments are not merely the surplus that would be 
spent on petty luxuries ; they have often to be provided by trenching 
on the primary needs of a healthy life. We have been impressed by 
the number of cases in which an industrious worker is obliged to stint 
himself and his family of necessities to meet interest charges without 
the faintest prospect of ever being able to reduce the principal. Many 
money-lenders take the precaution of making their dues the first charge 
on labour, and outside the gates of many, perhaps most, large factories 
on pay-day, stands the Pathan or other money-lender, awaiting his dues. 
In some cases the money-lender gets his dues at the source by being 
allowed to come to the pay-desk, but we have no reason to believe that 
this is a common practice. 
Indebtedness and Efficiency. 
The evil done by indebtedness is not confined to the hardship 
involved in the loss of money. We entirely agree with the Railway 
Board in their observation that the “ tyranny of debt degrades the em- 
ployee and impairs his efficiency ”. Indeed, we believe that debt is 
one of the principal obstacles to efficiency, because it destroys the 
incentive to effort. The indebted worker who makes an extra effort has 
little hope of securing a proportionate reward ; in many cases the only 
result may be to enrich the money-lender. Many workers, however 
hard they work, cannot expect to secure anything above the level of 
subsistence ; the “iron law ”” of wages is a reality in their case. The 
most powerful incentive to good work with the great majority of 
mankind is the prospect of securing a better livelihood : for too many 
Indian workers there can be no such prospect. 
Causes of Indebtedness. 
Our information goes to show that the most important single 
cause of borrowing is the expenditure on festivals, and particularly mar- 
riages. Births, deaths and other events of life may lead to the necessity 
for taking small loans, while periods of unemployment due to sickness, 
dismissal or trade stoppages have an appreciable effect. In Bombay.