From the beginning Raiffeisen invited to membership in his societies the well-to-do and substantial people as well as peasants. Of course these people did not require the society for the satisfaction of their own credit needs, but Raiffeisen saw that they would greatly strengthen the credit of the societies and he was able to appeal to them on philanthropic grounds. This class of people have a leading part in the administration of the societies of which they are members and have contributed greatly to their success.
At the outset the Raiffeisen societies had to rely chiefly on borrowing for the acquisition of the capital needed, but with time and success savings deposits, surplus funds accumulated out of profits, and lastly the proceeds of the sale of shares have played an increasing rôle. At the present time many societies are not obliged to borrow at all, and not a few have surplus funds which are placed at the disposition of other societies which are still obliged to borrow.
Like the Schulze-Delitzsch societies the Raiffeisen associations have federated. At present there are thirteen so-called unions, and at the head of all is a central bank with head office at Berlin and branches at Königsberg, Danzig, Breslau, Cassel, Frankfurt, Coblenz, Brunzwick, Strassburg, Nuremberg, Posen, and Ludwigshafen. The central bank is a joint-stock company, organized on the principle of limited liability, the stock of which is owned by the local societies. It formerly had close relations with the Imperial Bank, but is now associated with the so-called Centralgenossenschaftskassa, endowed by the state of Prussia, in such a way that advances and discounts are extended to it on favorable terms.
The Raiffeisen societies rival the Schulze-Delitzsch in the rapidity of their growth and in the rôle they play in the economic life of modern Germany. In 1908 they numbered 5,047, of which 4,340 were credit associations. The collective balance sheets of these societies in 1907 showed 490,734,834 marks assets, 489,234,357 marks liabilities, and a membership of 405,819.
While Germany was the pioneer in the establishment of land credit institutions, and while such institutions have attained a greater variety of form and a higher degree of perfection in that country than in any other, other countries have advanced along similar lines and now have institutions and a fund of experience well worthy of study. The institutions of Germany have in most cases served as models in these other countries, the mortgage banks and the Schulze-Delitzsch and Raiffeisen societies having been most frequently copied. These models have been adapted to foreign conditions and modified in interesting and instructive ways as well as copied without essential change.
Among the mortgage banks developed outside of Germany the Crédit Foncier of France is especially noteworthy. In its organization it was modeled after the Bank of France and is second only to that institution in the magnitude of its operations and the scope of its influence. Its head office is in Paris and it has at least one branch in each department. Its capital stock owned by private parties amounts to about $40,000,000, its surplus to over $4,000,000, its loans secured by mortgage to over $400,000,000, and its total resources to about $1,000,000,000.
Like the German mortgage banks, it secures the greater part of its loan funds through the issue of mortgage bonds and a large percentage of its loans are made on mortgage security for long periods of time and are repayable on the annuity plan. However, it transacts a greater variety of business than does the typical mortgage bank of Germany. It loans on city and farm real estate and to communes, and it transacts a large commercial banking business, though this is distinctly a side issue, incorporated with its other business in order to give profitable employment to funds, sometimes large in amount, which are temporarily on hand awaiting investment.
At various times it has absorbed competing institutions and at times it has established collateral institutions to transact lines of business for which its own constitution and legal limitations did not fit it. Among these the most important are the Crédit Agricole and the Foncier Algierienne. It was obliged ultimately to absorb and liquidate the former, but the latter still flourishes in the colony of Algiers.
Mortgage banks have also gained a footing in most of the other countries of continental Europe. In Italy they passed through a period of storm and stress, owing to their connection with the issue banks of that country and the consequent confusion between commercial and investment banking which resulted, but they have recently been established on an independent basis and are now developing along right lines and with apparent success.
The Schulze-Delitzsch and Raiffeisen societies have been imitated in Austria, Hungary, Belgium, Switzerland, and, to some extent, in France and India. The so-called "Banche Populari" and "Casse Rurali" of Italy are respectively modified forms of these two German types, and rank among the most important means employed in that country for the improvement of the condition of the peasants and small tradesmen. State, provincial, and communal aid for these institutions has been more frequently evoked and more extensively employed outside than inside of Germany, and other important modifications of the German prototypes have been made in Italy and elsewhere.