Disadvantages Of Rural Economy

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The world has come to a standstill -Atul Chaurasia Despite the government claims of opening 22 crore bank accounts under the Pradhan Mantri Jan-Dhan Yojana, the local moneylenders still play an important role in rural economy. They remain the only source of financing for a large section of the rural population. Many people prefer them over banks for borrowing to escape the hassles of paperwork and corruption. Usually, the moneylenders offer easy money after mortgaging land or precious belongings. Far from the world of plastic money, the decision to withdraw Rs 500 and Rs 1,000 notes have brought the rural economy to an uncertain grinding halt. “We have not made a transaction of even a single rupee for the past four days. There is…show more content…
From religious ceremonies and marriages to funerals, they are the last hope for a vast majority of the poor rural population in the hour of need. The existing banking system is still not developed enough to cater to the requirements of this section of the society. The private lenders are a much more convenient option for these…show more content…
Theirs is usually the biggest Khajla shop in the fair. The fact that they have not yet set up their shop has become a subject of local gossip. “The shopkeepers and cattle traders from outside the region have not reached yet. The fair will commence on December 9. It seems the event will only be a formality this year because of the note ban,” says Sachin Jaiswal, a local leader and the state secretary of the Samajwadi Yuvjan Sabha. The demonetisation has taken its toll on local markets as well. The traders have almost completely closed down their operations for the paucity of small denomination notes. The rumours circulating at a supersonic speed have not helped matters either. For example, people were forced to buy salt at rates varying from Rs 40/kg to Rs 400/kg after the word spread that it was out of stock. Another rumour about income tax raids on businessmen selling salt or gold at higher prices added to the confusion. There was news of such action on some locations. This has prompted traders to shut down their shops for the time

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