Microfinance is designed to open financial markets to people who had traditional
ID: 1118979 • Letter: M
Question
Microfinance is designed to open financial markets to people who had traditionally been underserved Answer the question, and then place the terms below, which all refer to some aspect of microfinance, into the appropriate column. To which of the following can the success of microfinancing be attributed? O O O Risk is transfered from the bank to the borrowers. Risk is limited by limiting the size of the loans. Banks began to have difficulty finding traditional borrowers. Banks began to charge a higher interest rate to small-scale entrepreneurs Barrier to Making Loans Reduces or Removes Barriers Community Pressure Lack of Collateral Shared Risk Gender Unknown Character Peer LendingExplanation / Answer
Answer - Microfinance is designed to provide financial help to the unemployed and undeserved people. Microfinance helps those people who did have access to the financial service before. Now some financial institution gives additional services like, accounts, small credit, insurance, etc to the low-income persons.
The risk of banks is limited by limiting the size of loans. They could not be a big defaulter like other. They have very limited access to the loans. Most og the governments have limited size of the loans thus no one can borrow more than that credit limit.
Option B is the correct answer.
Barriers to Making Loan Reduce Or Removes Barriers Lack of Collateral Shared Risk Unknown Character Peer Lending Community Pressure Gender