Question

Why does it become difficult for farmers in rural areas to take loans from government banks? Read the following reasons and choose the most appropriate option:

1. Lack of collateral
2. Complicated procedure
3. Higher cost of borrowing
4. Lack of awareness

Options

• Only I, II and III are correct.

• Only II, III and IV are correct.

• Only I, II and IV are correct.

• Only I, III and IV are correct.

Answer 1

Only I, II and IV are correct.

Explanation:

• Farmers in rural areas face difficulties in obtaining loans from government banks due to lack of collateral, complicated procedures, and lack of awareness.
• The higher cost of borrowing is generally more relevant to private moneylenders than government banks, making option III less applicable.