Question

informal sources of credit​

Answer 1

Answer:

traders

moneylenders

friends

relatives,etc.

Answer 2

MOSTLY INFORMAL SOURCE OF CREDIT IS REFERRED IN RURAL AREAS BECOZ PEOPLE THERE ARE UNEDUCATED AND INNOCENT SO THE MONEY LENDERS OR TRADERS WHO PROVIDE THEM MONEY ASK TO PAY A VERY HIGH INTEREST RATE. IF THE BORROWER IS NOT ABLE TO RETURN THE MONEY IN TIME HE HAS TO TAKE A FRESH LOAN TO REPAY. THIS INFORMAL SOUR OF CREDIT OFTEN LEADS TO A SITUATION CALLED DEBT TRAP SITUATION.