In a paper in the April 1977 issue of this Journal by Scobie and Franklin (1977) it is argued that supervised credit programs are of dubious value in promoting technological change in developing agriculture. However, the case presented by the authors is not conclusive and may be open to alternative interpretations because: (a) the general economic framework used by them is inappropriate for use in smallholder developing agriculture; (b) the results of the Guatemalan test case are inconclusive; and ( c) these results can be plausibly explained in other ways in any case.