Explain formal and informal sector of loans.
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formal sector loan is given by commercial banks where informal sector loan is given by land lenders big merchant
formal sector loan has low rate of interest where informal sector loan has a very high sector of interest.
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Formal sector= They provide loans in very low interest and for provide long duration to repay.These sectors are controlled by government.
Informal sector= These loans and are provided by moneylenders, zamindar and relatives.In this sector debtor has to pay more interest in short duration.
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