question_answer

  Manav needs a loan to set up a small business. On what basis will Manav decide whether to borrow from the bank or the moneylender? Discuss.           

Answer:

                  Manav will decide whether to borrow from a bank or moneylender on the basis of the following loan terms (i) The collateral and documentation required, he should be able to make these available. (ii) The rate of interest to be charged from  him. (iii) The mode of repayment, its periodicity, in cash / kind, etc.                                           (iv) The penalty in case of default in repayment.