Hpw do small farmer or labours arrange loan?
Dear Student,
a. Small farmers or labour generally take loans from informal sources of credit.
b. They take loans from moneylenders or traders who supply inputs to them. They also take loans from friends, relatives etc.
c. Here they are not required to give any written documentation and doesn't involve any collateral against which loan is sought.
d. The rate of interest that is charged is too high and is not regulated.
e. Thus, it becomes rather distressing for the small farmers to pay back the loan as they are generally exploited by the moneylenders.
Regards
a. Small farmers or labour generally take loans from informal sources of credit.
b. They take loans from moneylenders or traders who supply inputs to them. They also take loans from friends, relatives etc.
c. Here they are not required to give any written documentation and doesn't involve any collateral against which loan is sought.
d. The rate of interest that is charged is too high and is not regulated.
e. Thus, it becomes rather distressing for the small farmers to pay back the loan as they are generally exploited by the moneylenders.
Regards