'Report on the British Indian Commercial Mission to South-Eastern Persia during 1904-1905. By A H Gleadowe-Newcomen.' [‎13v] (31/176)

14
REPORT ON THE BRITISH INDIAN COMMERCIAL
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ruptcies are more rare amongst the bigger merchants, who are made to pay
very heavily for the privilege of taking Bant by the mullahs in charge, and Bant
is, at besi, little belter than prison. However, as import and export business is
conducted, so far as India is concerned, mainly on a cash basis, the Indian
manufacturer is not affected by this custom.
Banks and Banking—
There are in Persia two European Banks. The first is the Imperial Bank
of Persia, an English concern. Ihe other is the Banquede Prets de Perse, now
known ns the Banque d’Escompte et des Prefs, which is connected with the
Bussian State Bank, and managed by a Kussian Government Official. The one
is a mercantile firm, working as a State Bank, under charter from the Shah,
but dependent for its existence, more or less, on its profits, made in the usual
fashion. The other is a department of the Bussian Government rather than a
Bank. Both of these Banks have their Head-Quarters at Tehran.
The Imperial Bank of Persia, represented in India by the National Bank, has
branches at Tabriz, Kisht, Meshed, Kermanshah, Ispahan, Nasratabad (Seis-
tan), Yezd, Shiraz, Kerman and Bushire, and native agencies at Hamadan and
Kashan. There ought also to be a branch at Bander Abbas, wTdch would be
advantageous, alike to the Imperial Bank and to British trade. A small
branch might also be opened at Bam; this branch office need not be under an
expensive .European Manager, but under the management of a tried and trusty
Persian, Indian or Armenian subordinate. Bam is a place with a future;
already its inhabitants are rich* richer than those of any other district in the
Kerman Province.
The Bussian Bank has branches at Kisht, Meshed and Tabriz, and there is
talk of branches at Kerman, Bushire and Bander Abbas.
Besides these two banks there are many money-lenders. The majority of
these, in the South- Bast (Per.) A Persian custom allowing an individual to seek asylum at a designated location. , are Shikarpore Hindus. Their methods are those of
their brothers in India, but the rate of interest, charged for obligations, in
Persia,^ is higher. In parts the Armenians to some extent take the place of
the Hindus, both as traders and money-lenders. In every town there are
many Mahommedan Shroffs, who, although the E oran forbids the Moslem to
lend money on interest, find a way out of the difficulty, by lending the money
free of interest, but charging, at the same time, a special and high premium for
the favour of the loan. The Parsi element is now coming to the fore as
traders.
The mortgaging of landed property is common, but the holders of the
deeds are, as a rule, very glad to assist their debtors to resume possession,
especially when these debtors are the heirs of a dead mortgager. Mahom-
medans think that property, acquired under such circumstances, carries with
it a specially deep curse.
Much business is done by means of drafts and documents, hut banking has
not^ yet taken a firm foothold in Persia; firm for firm there is less banking
business done in Persia in six months than in India in one. Persians generally
do not understand the benefits of a Bank account. They are bewildered by
the calculation of rates of exchange, of discount and interest. Content to eat,
sleep and be merry after their own fashion, as long as they can do so without
feeling the pinch of want, they are glad to see the Hindu, Armenian or Parsi
conduct the trade of the country. Amongst such people, centuries behind
Europe in business habits, banking must be a difficult business and of slow
growth.
Persian traders^ generally keep running accounts with Persian or
Hindu Shroffs, who give them advances on current accounts, and their example
is followed often by importers, who find it convenient and economical in the
matter of exchange and discounts. There seems to be no opening for an
exchange bank, or, rather, little hope of its success ; existing banks can more
than meet the demands of the country, and it is possible that a considerable
expansion of business might result if the Imperial Bank of Persia could see its
way to be somewhat more accommodating in its methods of transacting
business.