Question

krishna is working in a neighboring field with very less wages . Expenses
on sudden illnesses or functions in the family are also met through loans
The landowner charges an interest rate of 5 percent per month
present she owes the landowner 5.000
Analyse the credit arrangements given above . if u know then only answer .​

Answer 1

Informal Sources of Credit

Explanation:

• Informal credit practices include lending, usually in the short term, among "relatives, friends, estate owners, families, retailers, residents, craftsmen, farmers, village lenders, marketing intermediaries, vendors, other local income classes."
• Informal loans include numerous typical types of non-institutional debt accumulation and debt extension. Although informal lending markets exist in cities, the term is commonly used in regional, informal lending markets where structured lending is not feasible or insufficient for the needs of local professionals.
• No State or private body is engaged in the administration or oversight by informal channels of credit operations. The credit terms are adjustable for the personal benefit of the borrowers. They typically charge higher interest rates and use the customers to support themselves..

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what are informal sources of credit mention any two features ...

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