Question

what are the formal sectors of loan? ​

Answer 1

Answer:

(i)Formal sector loans are such loans which are taken either from the banks or the co-operatives. While informal sector loans are those which are taken from moneylenders, traders, employers, relative and friends. (ii)In the case of informal sector of loans, the rate of interest is quite high.

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Answer 2

Answer:

Step-by-step explanation:

Formal sector loan is given by commercial bank whereas informal sector loan is given by money lenders, big merchants, etc.

• Formal sector loans has a low rate of interest.

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example: banks and cooperatives