Question

what do you mean by formal and informal loans.....???​

Answer 1

Answer: Difference between formal and informal sector loans:

FORMAL-

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

• Formal sector loan required collateral where as informal sector loans does not require collateral.

• Formal sector loans has a low rate of interest where as informal sector loans has a very high rate of interest.

INFORMAL-

• They are not supervised by RBI.
• They get loans from moneylenders, relatives, friends....
• It does not provide loan at fixed terms.

• It gives loans only for making profit.

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Answer 2

Answer:

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 where as informal sector loans has a very high rate of interest.

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