There was, in the early years of this state, a remarkable initiative at local parish level which, for the most part, is now all but forgotten. That was the development, in small rural areas along the west coast, of community owned Agricultural Banks, which, on the principle of self help and mutual support, helped improve the lives of thousands.
The turn of the twentieth century was a time of extreme poverty where many were forced into borrowing for the basic needs of food and clothing. These poor unfortunates became the prey of the usurers, the gombeen men and the unscrupulous lenders who charged exorbitant rates of interest and who showed little mercy. Very often they were the small town shopkeepers and merchants who grew fat on the plight of the poor, and were not above ‘accepting’ possession of a smallholding in default of an unpaid debt.
And so it was that Horace Plunkett, MP, the great advocate of the co-operative movement , pledged himself to rescue the destitute from the clutches of their exploiters. Under the aegis of his Irish Agricultural Organisation Society, and with the backing of the Congested Districts Board, he devised a plan which would see small farmers in each locality set up their own Agricultural Banks in which monies would be invested and lent out to members at affordable rates of interest.
To promote the idea, the IAOS engaged the Ulster born poet, George Russell, to travel the countryside to explain the concept and then to provide the guidance to get the banks operational. Crucially, the new idea won the support of the Catholic clergy, so that in every parish where Russell convened a meeting, the Parish Priest invariably took a lead role in recommending the idea to his flock.
In December of 1898, Russell arrived in Belmullet, there to introduce the Agricultural Bank idea to the people of the barony of Erris. By the time he completed his assignment, he had set up banks in Kilcommon, Ballyglass, Geesala, Belmullet and Aughoose. And the flame was spreading. When Plunkett himself visited Mayo in 1907, there were successful Agricultural Banks in operation in Ballyheane and Belcarra, Burriscarra and Ballintubber, Addergoole and Crossmolina, Killasser and Barnacarroll as well as many other places.
One of the most active was in Burren, north of Castlebar, where the PP, Canon Lyons, played a key role. In Kiltimagh, the new bank announced its intention to offer 4 percent to depositors and to charge 6 percent to borrowers – far less than the middlemen had been charging. The service, it said, was open to ‘small farmers, dealers, artisans and labourers’.While the local priest and local teacher were key to administering the bank, it is worth noting that the shareholders were the small farmers living off a few acres and raising large families. They ran the banks and, in spite of their lack of formal education, did so with acumen and good judgement. Small holdings were improved, modest investment made, tools and equipment purchased, and very often the money was borrowed to pay for the fare to England of a young son or daughter.
The banks were each formally registered as Friendly Societies; they were subject to annual audit; and the IAOS inspector kept a watchful but benign eye on activities. The Agricultural Banks operated until 1928, when they were dissolved, having fulfilled their function, on the establishment by the Government of a centralised Agricultural Bank.
They were the forerunners of the Credit Union movement which, 50 years later, would set up credit institutions based on the same principles of self help, service to the small saver, and ease of borrowing for those with no other alternative.