“Precisely,” agreed Mr. Wallingford. “That is just what our company obviates. Every man who drops out helps the man who stays in, by not having any claim upon the redemption fund. The redemption fund saves us from being a lottery. When you have paid in two hundred and fifty dollars your bond matures and you get your money back.”
“Out of—” hesitated Mr. Wright, greatly perplexed.
“The redemption fund. It is supplied from returned loans.”
Again the bright Mr. Wright saw a radical objection.
“Half of those people would not pay back their loans,” said he.
“We figure that a certain number would not pay,” admitted Wallingford, “but there would be a larger proportion than you think who would. For instance, you would pay back your loan at the end of four years, wouldn’t you, Mr. Wright?”
Mr. Wright was hastily sure of it, though he became thoughtful immediately thereafter.
“So would a large majority of the others,” Wallingford went on. “Honesty is more prevalent than you would imagine, sir. However, all our losses from this source will be made up by lapsation. Lapsation!”
Mr. Wallingford laid emphatic stress upon this vital principle and fixed Mr. Wright’s mild blue eyes with his own glittering ones.