. 3 Lean facility helps in increasing our income on the one hand, while on the other hand it traps us in the debt trap, how? Explain with the surrounding example.
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Debt Trap
Explanation:
- A Debt trap is an unfavourable situation in which the debtor is unable to pay the amount,
- When the debt is taken from the unorganized sector like a boy in the urban area taken the 500000 as a loan from the bank and after starting the startup business the boy is able to pay the loan in a scheduled way the specified amount,
- On the other hand the boy from rural area taken a debt of 10000 for the agricultural activities from the rural landlord as marked as an unorganized sector will not be able to pay loan because of the unfavourable situation in that case the boy tangled in the trap situation that is marked as the DEBT TRAP.
- The Debt trap can be ignorable if it is taken from the organized sector like banks and any recognized financial institution.
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