Why do formal sector do not meet the need of poor
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• Banks and Cooperatives are not present in every rural area
• even if they are present getting a loan is hard because of documentation requirements and collateral security
• absence of collateral is the major reason why poor cannot obtain loans
• even if they are present getting a loan is hard because of documentation requirements and collateral security
• absence of collateral is the major reason why poor cannot obtain loans
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Answer:
- Fomal sector do not meet the need of the poor people because mostly poor people do not have education and thus cannot maintain thier documents / credentials required in formal sector.
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