State the advantages of an SHG.

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Provide loans at cheap and affordable price

Requires no documents

Requires no collateral

All of the above

answer is D.

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Detailed Solution

Providing loans at a low and affordable price that requires no documents and requires no collateral are the advantages of SHG. SHG is a group of 15-20 members who save and meet regularly for various issues prevalent in our society. They save for one year or two, then are eligible to take loans from banks and create self-employment opportunities in the villages. They provide loans to the members of the cooperative societies for the purchase of agricultural implements, cultivation and agricultural trade, fisheries, construction of houses, and other expenses. They are a good source of informal credit as they don't require any documentation and collateral or security in order to give loans.

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