Question

Non-institutional sources of rural credit still performs a vital role in providing credit for ___________ purposes.

• A. productive
• B. unproductive
• C. industrial
• D. none of the above

Answer 1

Answer: (B)

unproductive

Non-institutional sources of rural credit still performs a vital role in providing credit for unproductive purposes.The traditional sources of agricultural credit termed as non-institutional sources.Non-institutional credit providers charge exorbitant interest rates ranging between 24% to 50%.In order to fulfill the financial requirements of the agricultural sector in rural India, appropriate and specialized credit agencies are needed. Credit helped to increase the productive capacity.Agricultural credit can be categorized on the basis of both purpose of credit and objective of credit provider.