Question

Elaborate the importance of credit in rural development. 

Answer 1

• In order to achieve greater productivity in both the agricultural and non-agricultural sectors, the rural economy's growth is mostly dependent on periodic capital infusions.
• Due to the lengthy gestation period between planting crops and receiving payment after harvest, farmers take out loans from both official and informal sources to cover their needs for fertiliser, seeds, and other household expenses like marriage and religious rituals.