Question

manam Needs a loan to set up a small business on what basis will Manav decide whether to borrow from the bank or the moneylender discuss

Answer 1

The salient points need to be considered to decide whether loan to be borrowed from Bank or money lender are stated below:

1)Documents and something to be mortgaged as security for repayment of a loan are required by banks. This documentation may not be possible for a poor farmer or person.

2) Comparison of rate of interest between the bank and money lender.

3) Mode of repayment like monthly basis or yearly basis.

4) Repayment by cash or in some other form.

5)Penalty applicable in case of defaulter.

Answer 2

his decision will depend on:-

1. if he has collateral

2. he is aware of the advantages of a bank credit

3. a bank is near his locality.

if any of these requirements is not fufilled then he will go to money lenders