Serving Rail Workers
Indianapolis, another railroad hub that competed with Columbus for the “America’s Crossroads” title, in the 1880s gave rise to new financial entities that grew up among the railroads and would become part of the Huntington’s growing family. The Union Railway Co. had been formed in Indianapolis in 1849 to address the growing issue of crisscrossing railroad lines — Union Railway laid connecting tracks and built a “Union Depot” at this major junction point. Though little more than a brick barn, the original structure nonetheless “appears to have been the first to collect all the major rail lines entering a city and put them in one building,” according to railroad historian John H. White.7
The Union Railway Co. was incorporated as the Indianapolis Union Railway Co. in 1883 and its president proved instrumental in planning other seminal rail depots including Washington, D.C.’s Union Station and New York City’s Penn Station. The Indianapolis Union Station was modernized between 1886 and 1888.
During this construction period, on Aug. 11, 1887, the Railroadmen’s Building and Savings Association received its charter. The organization was the brainchild of the Indianapolis Union Railway Co.’s paymaster, William Taylor Cannon, who observed that, “many railroad workers, prone to spending most of their earnings, were falling prey to unscrupulous loan sharks.”8At its founding, the operation was little more than an informal savings account: Cannon withheld a portion of each worker’s wages and stored this growing amount in a drawer in his Union Station desk, hardly a secure vault.
The association’s stated goal in its articles of incorporation was “to provide its members a safe and profitable investment of small weekly installments, and to loan them money on easy terms, to enable them to purchase a home or make other investments.”9 He offered no insurance, so we can only assume that the quality of his character served as the collateral necessary for these workers to willingly hand over a percentage of their pay. As the dollars accumulated, Cannon looked for a better, securer model, and hit upon the “Dayton Plan,” a subscription-based building-and-loan association model that emerged in the 1880s. Members could borrow money (membership could be gained for 25 cents), and the association was willing to loan about two-thirds the value of property in question at the nominal interest rate of 12 cents per each $100 borrowed. The repayment structure was equally friendly: