Answer :

The credit from the noninstitutional financial sources is the getting loans from the money lenders, relatives and many other therefore it does not have any code of conduct, and they charge any rate of interest which leads to the huge cost to the borrowers to repay, and lenders can easily exploit the borrowers. Rural poor always depend on the noninstitutional financial source of credit due to lack of awareness and ease of availability. When the credit is available for the emergency purpose, he will borrow from the noninstitutional financial sources.


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