Most of poor households are still dependent on informal sources of credit.. why? Do you see the effectiveness of Indian banking system in this situation
Answers
Answer:
Yes Most of the poor household are still dependent on informal source of credit because for taking loans they have to give many proofs to the bank which seems to be too hard for those poors and hence they have to take loans from other source. Ues it shows ineffectiveness of Indian banking system .
hope it helps if it helps mark brainlest
Answer:
banks are not present everywhere in rural areas where informal sources like money lenders are easily available. Money lenders provide loans to the poor people without any Collateral. Formal sources like banks give loans only for productive purposes, whereas informal sources provide credit for all reasons. The method of running business of formal sources are complicated and poor households cannot meet their condition. So, most of them are still dependent on informal sources of credit. Yes, this situation service in effectiveness of Indian banking system