Question

why do we need to expand formal sources of credit in India?​

Answer 1

Answer:

There is need to expand formal sources of credit in India as: (i)This would lead to higher incomes and many people could then borrow cheaply for a variety of needs. (ii)They could grow crops, do business, set up small-scale industries etc. (iii)They could set up new industries or trade in goods.

Explanation:

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Answer 2

Explanation:

We need to expand formal sources of credit in india because:-

(1) There is no organization which supervises the credit activities of lenders in the informal sector.

(2) There is no one to stop them from using unfair means to get their money back

(3) Formal sources of credit are less risky and they charge less rate of interest.

(4) The RBI supervises the functioning of formal sources if loans.