Question

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​

Answer 1

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.

Answer 2

The correct option is (c) Indigenous bankers and money lenders

• India's unorganized money market constitutes three parties namely -

1. Money lenders,
2. Various unregulated non-bank financial intermediaries and
3. 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.