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The Morris Plan

Louis N. Robinson
The American Economic Review
Vol. 21, No. 2 (Jun., 1931), pp. 222-235
Stable URL: http://www.jstor.org/stable/1827870
Page Count: 14
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The Morris Plan
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Abstract

Morris Plan companies and banks now do a business of about $220,000,000 a year. The "Plan" is a scheme of lending money at a high rate of interest, approximately 19.2 per cent, on the security of endorsers; it can also be used in financing a variety of transactions. Part of the capital is obtained from borrowers who invest their savings in certificates. The situation calls perhaps for a new kind of banking institution, one that would be allowed to accept deposits and to lend on the security of pawns, endorsed notes and chattel mortgages. The rate charged by the Morris Plan companies and banks, though higher than the usual legal or contract rates, is not out of line in comparison with the charges of other concerns extending credit to the masses.

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