informal sector credit in india essay
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The informal sector, informal economy, orgrey economy[1][2] is the part of an economy that is neither taxed nor monitored by any form of government. Unlike the formal economy, activities of the informal economy are not included in a country's gross national product (GNP) or gross domestic product(GDP).[3] The informal sector can be described as a grey market in labour.
Other concepts that can be characterized as informal sector can include the black market(shadow economy, underground economy),agorism, and System D. Associated idioms include "under the table", "off the books", and "working for cash".
Although the informal sector makes up a significant portion of the economies in developing countries, it is often stigmatized as troublesome and unmanageable. However, the informal sector provides critical economic opportunities for the poor[3][4] and has been expanding rapidly since the 1960s.[5] As such, integrating the informal economy into the formal sector is an important policy challenge.[3]
Other concepts that can be characterized as informal sector can include the black market(shadow economy, underground economy),agorism, and System D. Associated idioms include "under the table", "off the books", and "working for cash".
Although the informal sector makes up a significant portion of the economies in developing countries, it is often stigmatized as troublesome and unmanageable. However, the informal sector provides critical economic opportunities for the poor[3][4] and has been expanding rapidly since the 1960s.[5] As such, integrating the informal economy into the formal sector is an important policy challenge.[3]
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Formal and Informal Sectors of Credit in India.
The loan obtained from money lenders, relatives and friends, etc. constitutes the 'informal sector' of credit. They can lend money at any rate of interest and adopt any means to recover back their money.
The loan obtained from money lenders, relatives and friends, etc. constitutes the 'informal sector' of credit. They can lend money at any rate of interest and adopt any means to recover back their money.
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