6. Which of the following are unregulated credit agencies?
(a) Non-banking financial institutions
(b) Cooperative banks
(c) Indigenous bankers and money lenders
(d) Commercial banks
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Answer:
Constituents: The Reserve Bank of India, commercial banks, co- operative banks, development financial institutions, Discount and Finance House of India, indigenous bankers, money lenders, unregulated non-bank financial intermediaries, etc. are the constituents of money market in India.
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The correct option is (c) Indigenous bankers and money lenders
- India's unorganized money market constitutes three parties namely -
- Money lenders,
- Various unregulated non-bank financial intermediaries and
- Indigenous bankers
- The market's active operations are generally limited to rural regions.
- Indigenous bankers are financial intermediaries that typically perform the identical functions as banks. They primarily engage in hundi, an indigenous short term lending product.
- Money lenders are primarily active in the local villages and often demand a high interest rate. Money lenders arrange direct loans for both profitable and nonproductive purposes.
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