Compare the terms of credit for the small farmer, the medium farmer and landless agricultural labourer as given in the story on page 40.

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Solution

Small farmer Medium farmer Landless agricultural labourer

a. A small farmer would generally take loans from moneylenders who would charge high rate of interest as per his whims and fancies, A medium farmer has taken loan from a bank, which has charged low rate of interest. Repayment of loan is within a stipulated time but is flexible. A landless agricultural labourers is working in the neighbouring field, and has no work for months, due to seasonal nature of work.

b. A small farmer may not be asked to furnish any documents. He is asked to furnish documents as a proof. Would ask for a loan from a moneylender to meet his basic needs,

c. A loan would be given without a collateral. Is asked to give a collateral, as a security against which loan would be sought, Is charged high rate of interests and is continued to be exploited by money lenders.;

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Similar questions

In India, about 80 per cent of farmers are small farmers, who need credit for cultivation.

(a) Why might banks be unwilling to lend to small farmers?

(b) What are the other sources from which the small farmers can borrow?

(d) Suggest some ways by which small farmers can get cheap credit.

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Small farmer	Medium farmer	Landless agricultural labourer
a. A small farmer would generally take loans from moneylenders who would charge high rate of interest as per his whims and fancies,	A medium farmer has taken loan from a bank, which has charged low rate of interest. Repayment of loan is within a stipulated time but is flexible.	A landless agricultural labourers is working in the neighbouring field, and has no work for months, due to seasonal nature of work.
b. A small farmer may not be asked to furnish any documents.	He is asked to furnish documents as a proof.	Would ask for a loan from a moneylender to meet his basic needs,
c. A loan would be given without a collateral.	Is asked to give a collateral, as a security against which loan would be sought,	Is charged high rate of interests and is continued to be exploited by money lenders.;