What are the sources of Borrowing?

Differences between regulated and unregulated sources of borrowing:

Regulated sources of borrowing	Unregulated sources of borrowing
Commercial banks	Moneylenders
Co-operative Banks	Financial Intermediaries
Payments Banks	Indigenous Bankers
Microfinance Institutes	Family Members and Friends
Non-Banking Financial Institutes	–
Small Finance Institutes	–

Pro Tip

Regulated sources come under RBI and are obliged to follow rules . While, unregulated sources may set their rules on interest rate, payback period, loan amount and repayment method or collaterals to submit. It is always advised to depend on regulated sources.

Points to remember

There are regulated as well as unregulated sources for borrowing money.
Regulated sources are comparatively more secure and have lesser interest rates than unsecured sources.

To track your progress

What are the sources of Borrowing?

Pro Tip

Read more to know why you should be careful while borrowing!