What is credit why is there a need for credit in rural areas?
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Credit refers to an agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment. There is a need for credit in rural areas for the following reasons.
(i) In rural areas, the main demand for credit is for crop production.
(ii) crop production involves considerable costs on seeds fertilisers, pesticides,water electricity, repair of equipment, etc.
(iii) Farmers usually takes crop loans at the beginning of the season and repay the loan after harvest.
(iv) Rural people also take loans for starting small business and for the marriage of their daughters.
(i) In rural areas, the main demand for credit is for crop production.
(ii) crop production involves considerable costs on seeds fertilisers, pesticides,water electricity, repair of equipment, etc.
(iii) Farmers usually takes crop loans at the beginning of the season and repay the loan after harvest.
(iv) Rural people also take loans for starting small business and for the marriage of their daughters.
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Answer:
Credit refers to an agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment.
There is a need for credit in rural areas for the following reasons:
i. In rural areas, the main demand for credit is for crop production.
ii. Crop production involves considerable costs on seeds fertilisers, pesticides, water, electricity, repair of equipment, etc.
iii. Farmers usually take crop loans at the beginning of the season and repay the loan after harvest.
iv. Rural people also take loans for starting small business and for the marriage of their daughters.
Explanation:
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