Question

Why is cheap afford agle credit is important for country development

Answer 1

Cheap and affordable credit playsa crucial role for the country’s development. There is a huge demand for loans for various economic activities. The credit helps people to meet the ongoing expenses of production, complete production on time, and thereby increase their earnings. The main benefits from derived credit for developmental activities are :


1. Credit plays a major role in the development of a country of creating better facilities for agricultural and industrial activities.

2. Credit helps people from all walks oflife in setting up their business and increase their earnings.

3. For middle-class people, loans help a lot in constructing their houses and get rid of monthly rents.

4. Credit or loans help in raising the standard of living and social status of the common man by enabling them to buy cars, scooters, televisions and other products.

Answer 2

Cheap and affordable credit is crucial for the country's development due to the following factors:

More lending would lead to higher incomes and encourage people to invest in agriculture, engage in business and set up small scale industries.

Cheap credit means more income would be left with the borrower to reinvest rather than return as interest. This leads to acceleration of economic activity.

Cheap credit would also allow weaker sections of society to enter formal sector of lending and rid them of exploitation at the hands of informal moneylenders.

Affordable credit would also end the cycle of debt trap and lead to sustainable economic activity that would allow borrowers to invest in better technology to make their business more competitive.