Page 108 - 5 Persian Trade rep BUSHIRE I_Neat

8 BD8IUBR.
at the end of 1907 arising from the disturbed state of the roads
resulted in a smaller number of bills than usual being offered for
sale during January, 1907-08.
Discounts.—Tightness of money in the summer of 1907 sent up
the rates of discount on Shiraz bills; it is difficult to give more
than an approximate average for the preceding years. Roughly
speaking, the figures for bills at 17 days’ sight were:—
Per Cent.
1903- 04... I
1904- 05... 1
1905- 00... 2
1906- 07... H
1907- 03... 2i

The average rate of interest for local advances and overdue
bills has now been for some 10 years or more 12 per cent, per annum.
Credit system.—It is difficult to make any precise statement
as to the actual operation of the credit system, on which nearly
all business is transacted, in comparison with its working in former
years. The usual trade custom of the place has been for shipping
documents to be handed over by the consignee agents to the indentor
on his acceptance of bills drawn at 90 days after sight in the case
of piece-goods, 45 days’ sight in the case of sugar and shorter
periods for other articles. Tliis does not prevent business being
occasionally done on a basis of cash against documents, or bills
being settled before maturity; but the general tendency nowadays
resulting from the hard times and bad markets of the last year
or two has been for bills to be seldom fully met on due date. The
same tendency to delay payment may be observed in the drawing
of native drafts on Shiraz at 35 days after date to allow of the
goods reaching Shiraz and possibly finding a sale before maturity
of the draft. Generally speaking, in the past it has been possible
to do a good import business through approved agents who are able
on the spot to gauge their diems’ capital and respectability, the
handsome profits realised in the annual turnover compensating
for bad debts, but in some cases it would seem as if credits had been
too largely given. The smaller Persian merchant starts business,
more often than not, on a very small capital of his own, and in
order to keep himself going is frequently obliged to dispose of goods
ordered out on credit even at a loss so that he may be enabled to
make further indents. On these small traders, more than on the
greater merchants, falls the burthen of getting in the proceeds of
the sales to retail dealers, shop-people and buyers in the villages,
and in times such as the present in this part of Persia a large number
of them have unfortunately contrived to extend their indents
grossly beyond the value of their assets with the simple object
of obtaining funds to tide them over a difficult time. The increasing
number of claims for which the British importing merchant is
compelled to resort to official interference frequently bring out