THE SECOND TASK OF THE PRIVILEGED AGRARIAN BANK: CREDITING OF THE AGRARIAN COOPERATIVE FARMING

Expert contributions
Autor: Prof. Dragana Gnjatović PhD

Summary: The second task of the Privileged Agrarian Bank was to supply farming population and farming organisations with cheap consumer loans. It was proclaimed that in granting such credit facilities, all the interested parties would be treated on equal terms. In actual practice, however, this principle was not respected to the full. Dr. Bogdan Markovic, president of the Bank’s Board of Directors, explained to the refused loan applicants that personal agrarian loans shall be approved only “on the basis of real security pledged for the loan”. Thus the real security was the measure of credit worthiness of the farmer and the requirement for obtaining not only of a mortgage loan but also of a consumer credit facility from this specialised financial institution. This rendered its financial support to remain out of reach of those farming households that did not have proprietary title deeds over the land which they cultivated and where they lived. Among them were the households of settlers and colonists who acquired the land after First World War under the implementation of state restrictive measures of agrarian reform and colonisation. The land, expropriated from large-scale landlords, was allocated to the settlers on condition that they should repurchase it, while in cases of settling in arid wastelands or on a state-owned property, the government was delaying endowment of land to the new owners. Thus the Privileged Agrarian Bank regarded all settlers and colonists merely as: at present time tentative, but in the near future probable proprietors of real estate.

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