Emergency Cash Loan at low interest rate

Moneylending has historically been the main method used to transfer land ownership from debtor-cultivators to other parties, whether they be non-agriculturalists or agriculturalists. Due to regulatory constraints on the transfer of land to non-agriculturists, agriculturalist money lenders have benefited the most from such land transactions. Thus, a significant portion of the growing pauperization in rural India is attributable to the credit extended by moneylenders.

Small and marginal farmers, villagers' craftsmen, factory and mine workers, peons, menials, and other low-wage workers and small traders make up the majority of the community's moneylenders' clients.

Richer farmers can borrow money from co-operative credit societies and other institutional organizations if they need it. They might possibly be borrowing from arhatias for brief periods of time (commission agents). However, the majority of moneylenders' funding is used to support small borrowers' credit demands.

The latter group is still essentially excluded from institutional lending. The majority of the remaining characteristics of moneylenders’ credit come from the fact that the borrowers are helpless, impoverished, and has no other options for credit.

The promptness, informality, and flexibility of the moneylenders' credit are its saving features. Because moneylenders are only interested in their interest income provided they are given the assurance that the principal amounts of their loans are safe, loans are easily extended upon regular and prompt interest payment. However, all of this seems insignificant to the borrowers given the negative aspects of this sort of lending.

It is generally believed that accepting the credit offered by moneylenders as a necessary evil is the only option in the lack of suitable institutional sources of credit for the most vulnerable and in needy segments of the population.

Several legislative measures, such as limitations on land alienation, controls, or other regulations, have been passed in the past.

The institutional sources of credit must be developed. The amount of credit made accessible should receive the majority of attention, not the low interest rates. Financial institutions should not be required to bear the additional burden of offering loans at preferential rates of interest due to the high cost of servicing small loans and small customers as well as the difficulty of recovering loans and related overdues. They will be deterred from giving any credit that they otherwise would by this.

This is also how things have gone so far. Small borrowers require sufficient institutional credit. When compared to other options, giving it to them at the organised market's rates of interest is extremely generous.

Do banks act as lenders?

Why aren't banks included in the definition of a moneylender if they lend money?

A particular kind of lender is referred to by the single phrase "moneylender."

When referring to legitimate banks, we could use the terms "moneylender" and "bank," but we would need to phrase the two terms separately, as in "a bank is a money lender" (banks also take deposits).