Importance of money lenders in Indian economy point wish
Indian population mostly live in rural areas and 66 percentage of population earning dependent on agriculture and agricultural related activities. Importance of money lenders in Indian economy in point wish explained. Rural population of India directly or indirectly in contact with money lenders. Government of India provided financial support to massive farmer population by forgiveness of thousands of dollars banks loan.
Economic history of indian economy provided many evidence of importance of money lenders in Indian economy. From ancient times money lenders are called as kusidin.
Kusidin word taken from manusmriti text and economic history of Indian economy mentioned a systematic type of money lending started from maurya age.
Despite of forgive loans of farmers by government of India but still farmers population in great financial stress. Reason for farmers financial misery is that government only waviers only formal type of loans.
Due to which farmers have to give importance to money lenders to owe their debts. Money lenders provided formal loans and informal loans to rural population.
Rural population of country still get loan amount from sahukar. Sahukar are known as money lenders in Indian economy. Money lenders are present in rural areas from very long generation. Money lenders in rural India grown their buisness in giving money to million of farmer population. Since independence of India, money lenders increased their grip inside rural population.
Studied data collection from various sources after independence Indian economy started shifting from agriculture sector towards industrial sector. From the record published by Indian government agencies rate of farmers suicide increased every year.
Role of money lenders in India
We all know that that doing farming is like doing gambling. Many farmers in a country understand role of money lenders in India, prefer local money lenders to banks for taking loans because many farmers in country don't have proper knowledge of keeping records properly and due to which traditional bank stop loan amount delivery due to poor paper records found during security check work.
Many farmers of country have to make payment of wages like labour cost, seed cost, implement cost and transportation cost etc, due to these reasons farmers of country required financial support in short duration.
Many farmers of a country do not have money to do farming of next season due to which they prefer local money lenders to get loans amount faster duration in short duration at higher interest.
If everything remain good then agriculture will earn lots of profit but in most of time farming not able to give production as expected.
Due to shift of focus of government of India and not taking it seriously. Prices of seeds, insecticides, pesticides, fertilizers and agriculture implements prices are increased.
More loan demand good or bad for economy is an point of discussion. India's arround three million farmers added to debts because of the arrival of high cost seeds and pesticides.
Why is money lenders important even today
Due to high globalisation farmers have shown higher production dreams and earn more money as profits by government policy time to time.
But reality is quite different to get higher production of crops farmers uses high cost seeds and pesticides. This will results in farmers got under more debts.
Money lenders are important even today because majority of farmers population do not have enough money to make purchases of agriculture related essential products. To do farming of next season farmers have to make contact with money lenders to get money in short duration.
Money lenders are available in between country population from generation and established importance of money lenders even today deep rooted inside population of country.
What is a hard money lenders
Hard money money lenders are one of type of money lenders available all over world. Hard money lenders provide hard money as a form of loan. Hard money lenders provide hard money which is secured by real state.
Importance of money lenders in Indian economy point wish explained after studied hard money lenders. Hard money lenders provide short period loans in high interest rate to borrower.
Hard money lenders can be any one of these who used his own fund to provide loans like individual, investors, group of investors and private mortgage brokers.
What role did importance of the money lenders play in lives of the peasants and rural population.
Money lender in rural India provided loans at high interest rate to peasants and rural population. Role did importance of the money lenders play in life of the peasants and rural peoples take money from money from money lenders at high interest rate to make payment of wages and revenues.
In case any peasants and rural people not able to make repayment of loans money from money lenders, then money lenders take them to court and to make auction of property of peasants and rural people who not able to pay loans and take their loan amount with interest.
Importance of hard money lenders in Indian economy point wish
Peoples who really want to get loans make there preference of moving towards hard money lenders instead of going towards traditional source of loans providing agency like banks.
Potential people of loan don't want to go through hard paper check work done by banks and want fast delivery of loan amount at higher interest for shorter duration of time.
Indian society is economic based society and always required financial support in short period because people have make payment to full fill their daily needs.
Hard money is a economic term which is defined as money which received by borrower at higher interest rate for shorter duration by giving less paper as mortgage to a hard money lenders.
Who were money lenders
Economic definition of money lenders can be defined as group of people who provided small loans money to rural and urban population at higher interest rate.
Money lenders charged higher interest rate can be justified because money lenders take high risk in providing loans at self believe.
Secondary data collected from all India debts survey arround 49 percentage of Indian farmers have taken loan from money lenders (informal source).
Collected data from survey of all India debts survey indicated number of percentage of farmers increased every year. 31 percentage of farmers at 1991 taken loans from money lenders. At present time 2021-22 these percentage increased between 48-50 percentage taken loans from informal source or money lenders.
Licensed money lenders interest rate charged in India
Money lending act of India, as from act clearly mentioned interest rate can not be charged very high. Money lending act of India given interest can be charged upto 24 percentage per annum.
Reserve Bank of India (RBI) said that money lending is a legal process till time it is done between person to person.
RBI said intrest of both loan taker and loan provider should be given full protection then money lending become legal process.