Royal Commission on Labour in India: Report(1929)||
Indebtedness is by no means confined to the industrial worker; it is in fact fairly general throughout India and we recognise that some of the recommendations made later may be applicable to classes other than industrial workers. But we must emphasise the fact that, in respect of borrowing, the position of the industrial worker is in important respects different from that of the agriculturalist. The main difference is caused by his mobility. The man who moves from mill to mill, from centre to centre, from town to village is an unsound proposition from the money-lender's point of view. In addition, part of the agriculturalist's borrowings takes the form of short-term loans connected with his avocation, and can usually be repaid from the increased income which results. Practically none of the borrowing of industrial workers is of this character. Finally, while the agriculturalist in a number of cases can offer security, this is seldom possible for the industrial worker. His family may have a few ornaments, but after these have been pledged or sold there is nothing left but future earning capacity. A debtor who is not a permanent resident of the area where the money-lender carries on business, who cannot offer security, and who is not likely to obtain any increase in income as the result of his borrowing is in every way an unsound proposition. It is not surprising, therefore, that the industrial worker should have to pay particularly high rates of interest. We doubt if the majority of money-lenders amass the large profits attributed to them by popular belief. Apart from the immense amounts of interest which remain unpaid, there is a high proportion of bad debts. Although the sums collected must be enormous in the aggregate, the army of money-lenders is great and the expenses of collection are often substantial.