Single Answer MCQ
Q-00045478
Why do poor households often rely on informal credit sources instead of formal ones?
1
Better terms and conditions
2
Lack of access to banking
3
Lower interest rates
4
High savings rates
Answer and Solution
Answer
B. Lack of access to banking
Solution:
Poor households frequently rely on informal credit because they often lack access to banks and the necessary documentation to obtain formal loans, pushing them to informal sources.
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