Economy, asked by sreejithharidas4951, 11 months ago

Discuss the shortcoming of formal source of credit

Answers

Answered by swatishilpa

Explanation:

Informal sources of credit include credit from traders,relative,friends and moneylenders etc. There is no such organizations to supervise the lending activities of such sources

Answered by iraza

Answer:

FORMAL SECTOR

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•We can get formal sector credit loans from Bank, LIC etc

•They are under the control of RBI

•If we don't pay the loan back the take legal action

•They give loan in reasonable interest

•Collateral is necessary

•This take more time for process

The two major sources of formal sector credit in India are — commercial banks and cooperative societies.

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