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differences between formal and informal sectors loans

loans taken from moneylenders, traader is called informal loan.

the intrest rate is high.

they dont have to submit colateral.

loans takenfrom bank is called formal sector loan.

the intrest rate is low

those taking loan have to submit colateral

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 Formal Sector Loans
  • These consist of loans from banks and cooperatives
  •  These loans are supervised by the RBI
  • The terms of credit are fixed
  •  Rate of interest is not very high
  •  It comprises 52% of the total loans given in the country 

 Informal Sector Loans

  •  These consist of loans from moneylenders, landlords, traders, relatives and friends etc.
  •  They are not under the control of the RBI
  • The rates of interests are exorbitant
  •  It comprises 48% of the credit in the country
  • It is mostly taken by poor rural households
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 Hi,

I agree with Hemal. He did really nice..

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hey i m not a boy !!!!!!!!!!!!!!

but thnx for appreciation

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 HI,

I am really sorry for this misunderstanding. Your name is sweet but alittle bit confusing.

Forgive me please....

Anyway your ans. is perfect..

Sorry again...

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its ok ........

& thnx for a 

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Loans from banks and cooperatives 

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The difference between the formal and informal sector are as follows:-Informalsector credit:1. There is no state to supervise its functioning2. There isno rigid rate of interest3.For example, moneylenders, traders, friends, relatives etc.Formal sector credit:1. The state supervises and regulates its functioning2. The rate of interest is fixed and is reasonable3. For example, banks and cooperatives.
Hope it helpzzz......... :D :D :D
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formal sector-1.these resources are under the control of the government.
2.they charge a very low interest rate.
3.formal resources include commercial banks and co-operatives.
informal sector.1.these resources are not under the control of the government.
2.they charge a very high interest rate.
3.informal resources include money lenders,relatives and friends.
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lol
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 Formal Sector Loans
These consist of loans from banks and cooperatives
 These loans are supervised by the RBI
The terms of credit are fixed
 Rate of interest is not very high
 It comprises 52% of the total loans given in the country 
 Informal Sector Loans

 These consist of loans from moneylenders, landlords, traders, relatives and friends etc.
 They are not under the control of the RBI
The rates of interests are exorbitant
 It comprises 48% of the credit in the country
It is mostly taken by poor rural households
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Informal :- It has no security in job .
Formal:- It has security in its job.
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Idk.
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the ans given by hemal is perfect

 
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*Malpractises can take place in informal sectors whereas not in formal sector.
*Formal sector is regulated by Reserve Bank of India while there is no one to regulate informal sector
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#formal_sector :                                                                                         #informal_sector :
*These consist of loan from bank or cooperatives.                  *These consist of loan from money                                                                                                                                    lander,landlord,friend and family
*The loans are survived by RBI                                             *They are not under control of RBI
*Rate of interest is not very high                                            *Rate of interest is very high 
*It is comprise 52%of the loan given in the country              *It comprise 48% of credit in country
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       Formal sector loans                                                Informal sector loans
  • Interest rate is low                                               Interest rate is very high
  • Loans from banks,cooperative sectors etc          Loans from relatives,friends etc
  • Collateral is required                                          Collateral is not required
  • Generally it does'nt leads to debt traps               Debt traps are common
  • RBI supervises formal sector loans                    No institutions supervises informal sector loans
   

                                                                          
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Please find this answer

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Formal Sector
*Has rules and regulations.
*Supervised by RBI.
*Low interest rate.
*Motive- Profit making.
*Eg;-banks,co-operatives.

Informal Sector
*Did  not have rules and regulations.
*Not under control.
*High interest rate.
*Motive-Social welfare.
*Eg;-money lenders,traders.
 
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 Formal Sector Loans
1. These consist of loans from banks and cooperatives
2. These loans are supervised by the RBI
3. The terms of credit are fixed
4. Rate of interest is not very high
5. It comprises 52% of the total loans given in the country
 Informal Sector Loans
1. These consist of loans from moneylenders, landlords, traders, relatives and friends etc.
2. They are not under the control of the RBI
3. The rates of interests are exorbitant
4. It comprises 48% of the credit in the country
5. It is mostly taken by poor rural households
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Money is accept es as a medium if exchange because the currency is authorised by the government of the country.☺
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It is necessary for banks and cooperatives to increase their lending in rural areas because the money lenders in rural areas are charging higher rate of interest and the rural people were unable to bear the interest cost. Most of theri earnings are used for paying the interst. Hence, banks and cooperatives can provide loan at low interest rate which will enable them to avail such loans.
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How informal loan push the people in dead trap
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Answer in tabular form easy for u

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Arunima Kishor student of Kendriya Vidyalaya Rubber Board Kottayam

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# 🤗# ans #$

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INFORMAL SECTOR
  1. CONSIST OF LOAN FROM MONEY LENDER
  2. NOT UNDER RBI
  3. MOSTLY TAKEN BY POOR RURAL HOUSEHOLDS
​​FORMAL SECTOR
  1. CONSIST OF LOAN FROM BANK 
  2. UNDER RBI
  3. MOSTLY CHOOSED BY URBAN EDUCATED PEOPLE
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Difference between formal and informal sector

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INFORMAL SECTOR:-
Usually the rate of interest is very high
People can get loans faster and easily
Manier times people need not give any guarantee that they will repay the loan
NO need of documentation that means  less paper work
It is not under the control of RBI
The poor and less educated are often exploited by the lenders i.e,by increasing the interests without the knowledge of the borrower

FORMAL SECTOR:-
The rate of interest is low and reasonable
The bank needs to follow a particular process before sanctioning a loan for the borrower which is time consuming
Borrower needs to show any guarantee that he is going to repay the loan and also needs to mention the mode of payment
Documentation is important for the bank to give loan
It is under the control of RBI which means the rate of interest,functioning of bank and many other issues are checked by RBI
The banks do not exploit the customers

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↵you can also write in tabular form.....
ANSWER
Formal sector loan
 
  1. Comparatively rate of interest charged is lower than that of the informal sector loans.
  2. RBI supervises their functions of giving loans.
  3. Collateral is required to obtain credit.
  4. Rich urban households depend largely on formal sectors of the credits.
  5. EXAMPLE Banks and Cooperatives.

INFORMAL SECTORS 
  1. Higher interest rates on loans are charged.
  2. No organizations are there to supervises its lending activities.
  3. They are ready to give the loans without collaterals.
  4. Poor households largely depend on informal sources.
  5. EXAMPLES Traders , employees, money lenders, friends and relatives etc
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The informal sector, informal economy, or greyeconomy is the part of an economy that is neither taxed, nor monitored by any form of government. Unlike the formal economy, activities of the informal economy are not included in the gross national product (GNP) and gross domestic product (GDP) of a country.
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j;kl
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jnk.
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formal sector of credit -
it provides loans comparatively at a lower rate this sector is mainly supervised by the RBI it includes banks and cooperative and Collateral is required to obtain loans
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This will help you all

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Formal and informal sector loans money and credit chapter in table
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Key poinys

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Informal sector= 1 there is no government rules and regulations

2 = they may take any holiday at any time
3 example = friends money lander and traders
4 =i f someone want to help more time in his job then he or she gave him extra wages .



Formal sector is inverse of informal sector
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Please find this answer

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Please find this answer

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I dont know sorry too much i am blind sorry
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Please find this answer

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Hello everyone

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Please find this answer

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Formal sector loan:
They are supervised by the Reserve bank of India.
These consists of loans from banks and cooperatives.
It provides loans at fixed rate and terms.

Informal sector loans:
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 profits.
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Formal sector loans?are such?loans?which are taken either from the banks or the co-operatives. While?informal sector loans?are those which are taken from moneylenders, traders, employers, relative and friends
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Formal sector loans charges low interest on loans whereas informal charges a lots of high interest
Motive of formal is social welfare whereas making profit is the motive of informal

Sources of credit are supervised by the government and RBI for formal loans whereas no organization supervises the loans given by the informal sector
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Formal loans:
* provides loans with low interest
*supervised by the government and RBI
*main motive is the welfare of people
Informal loans :
*provides loans with high interest
*no organization supervises its operations
*main motive is to earn profit
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thanks for the answer this helps me a lot
 
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difference sent in format
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hello chai pilo
 
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Gshhffk
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Answer

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Swarg UP Gramin Bank
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Formal Sector Loans

These consist of loans from banks and cooperatives?These loans are supervised by the RBIThe terms of credit are fixed?Rate of interest is not very high?It comprises 52% of the total loans given in the country?

?Informal Sector Loans

?These consist of loans from moneylenders, landlords, traders, relatives and friends?etc.?They are not under the control of the RBIThe rates of interests are exorbitant?It comprises 48% of the credit in the countryIt is mostly taken by poor rural households
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explain the difference between formal sector loans and informal sector loans
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Money is any goods that is widely accepted in exchange of goods and services, as well as payment of debts
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Please find this answer

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Ok thank you
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There is no social science subject in this app
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