Why do most of the rural households still remain dependent on the informal sources of credit? Explain. 

(i) Limited availability of Banks in rural areas. 

(ii) People in the rural areas face problem with regard to documentation. 

(iii) Absence of collateral is one of the major reasons which prevents the poor from getting bank loans. 

(iv) Rural people get easy loans from the richer households through informal ways. 

(v) Any other relevant point.

OR

(i) People can get timely loans for a variety of purposes and at a reasonable interest rate. 

(ii) SHGs are regular in their savings which can be used as monetary help. 

(iii) Members can take small loans without collateral to meet their needs. 

(iv) Due to timely repayment banks also lend loans to SHGs. 

(v) Any other relevant point.