state gov Bihar Police Constable (सिपाही) Mock Test Series 2025 General Knowledge Economy Money and Banking
In the context of rural development, what is a critical challenge associated with traditional rural credit systems in India?
1
High reliance on informal sources leads to exploitative interest rates and debt traps for farmers
2
Formal banking institutions entirely replace informal lenders, eliminating local financial practices
3
They provide too much credit to rural households, leading to inflation
4
Interest rates are uniformly low, discouraging savings