Despite the fact that Ottoman statesmen initiated the fundamental reform movement known as Tanzimat in 1839, it was not until the 1860s that the reforms were first introduced to the periphery of empire. In doing so, the Ottoman administration chose the Danube province as the pilot region where their governor Midhat Pasha would carry out the reforms as examples for the other provinces. At that time, the economy of the Balkans was highly dependent upon agriculture, and there were no institutions like those in Europe offering loans to farmers and meeting their needs, such as land, seeds and animals. Loan sharks and gospodars (landowners) benefited from the lack of such an institution by lending money to peasants at high interest rates and requiring them to perform corvee labor. In this situation, the peasants had no opportunity to advance their agricultural activities, as they were highly dependent on these lenders. Midhat Pasha was aware of this problem, and so he observed the examples of agricultural organizations in Europe. Thus, in 1863, when he was the governor of Nish, he established an experimental agricultural credit cooperative called Memleket Sandigi in Pirot (Sarkoy or Sehirkoy). It was to provide farmers with credit at low interest rates, seeds and animals, to create cooperation among them and to promote the agricultural production to a higher degree, independent of the landlords. It also aimed at opening a large amount of arable land for farming. It was the first agricultural credit cooperative in Ottoman history, and would form the origin of the agricultural bank of modern Turkey. In this paper, I will examine this new institution as part and parcel of the Ottoman reform movement with an emphasis on the changing role of government in agriculture and rural life. I intend to make use of the documents in Basbakanlik Osmanli Arsivi (the Prime Ministry Ottoman Archives) in Istanbul, which directly concern Midhat Pasha's activities and reforms in the Danube province. These documents are mainly comprised of the Irades (imperial degrees) such as Irade Dahiliye, Irade Hariciye, Irade Meclis-i Vala, etc. In addition to these documents, the first provincial newspaper, Tuna Gazetesi, the Salnames (yearbooks of the province) and the memoirs of Midhat Pasha himself are also used in my research. Finally, I will reference a number of secondary sources written in English, Turkish, Bulgarian and Russian languages.