Why does it become difficult for farmers in rural areas to take loans from government banks? Read the following reasons and choose the most appropriate option: I. Lack of collateral II. Complicated procedure III. Higher cost of borrowing IV. Lack of awareness
Farmers face problems taking loans from government banks due to lack of collateral, complicated procedures, and lack of awareness. These barriers force them to depend on informal moneylenders who charge higher interest rates. Correct Option: (C) Only I, II and IV are correct.
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Rural farmers often lack sufficient collateral or property documents, making it difficult to access bank loans. The loan process is lengthy and complicated, and most farmers are unaware of government schemes or formal banking rules. As a result, they rely on private moneylenders, leading to debt traps and financial exploitation. Correct Option: (C)