X Variety of Credit Arrangements
Variety of Credit Arrangements 1 Moneylender (informal ) 2 Agricultural trader (informal) 3 Bank loans (commercial banks) - formal 4. Landowner and employer informal 5. Cooperative bank - Members of a cooperative pool their resources (money) for cooperation in certain areas(bank). These banks are registered under the cooperative acts. There are several types of cooperatives possible such as farmers cooperatives, weavers cooperatives, industrial workers cooperatives, etc. self-help groups- in small Self Help Groups (SHGs) and people (poor/women) pool (collect) their savings. A typical SHG has 15-20 members, usually belonging to one neighborhood, who meet and save regularly Saving per member varies from Rs 25 to Rs 100 or more, depending on the ability of the people to save Members can take small loans from the group itself to meet their needs. The group charges interest on these loans but this is still less than what the moneylender charges After a year or t...