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Question -

Critically evaluate the role of the rural banking system in the process of rural development in India.



Answer -

After nationalisation of banks took place in 1969, rural banking has grown a lot. This has helped in rural development in the following ways:

1. It helped increase the farm and non-farm output by supplying credit facilities to customers.

2. Provided long term loans with better repayment options. It helped dependency on moneylenders

3. Achieving food security by production of food grains in abundance.

4. Assisting self-employment schemes in rural areas for generating credit

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