10th std Economics 3. Money and Credit

10th std Social Science Economics 3. Money and Credit
Money is any good that is widely used and accepted in transactions involving the transfer of goods and services from one person to another.
Any circulating medium of exchange, including coins, paper money, and demand deposits.

1. Grade-10 –Economics
Chapter-3-Money and
Credit
BY; NAVYARAI

2. Money
•Money is any good that is widely used
and accepted in transactions involving
the transfer of goods and services from
one person to another.
•Any circulating medium of exchange,
including coins,paper money, and
demand deposits.
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3. Barter System
•Goods are exchanged without use of
money.
•Double Coincidence of wants : In
exchange of goods both parties have to
agreeto sell and buy each others
commodities.
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4. Limitations of Barter System
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Lack of Double Coincidence of Wants
Lack of Common Measure of Value
Lack of Store of Value
Lack of Standard of Deferred
Payment

5. Money As A Medium Of Exchange
•In an economy where money is in use,
money by providing the crucial
intermediate step eliminates the need
for double coincidence of wants.
•Money acts as an intermediate in the
exchange process, it is called a medium
of exchange.
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6. Roles of Money
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7. Early Coins of India
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Coins of Alupas
Hindu Coin of
Medieval India
Coins of Kushan
Dynasty

8. Modern Forms of Money
Currency
Bank Deposits
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9. Why Modern Currency is accepted
as medium of exchange?
•It is accepted as medium of exchange
because the currency is authorisedby
the government of the country.
•In India Reserve Bank of India issues
currency notes on behalf of the central
government.
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10. Various Types Of Bank Deposits
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Savings Deposit
Recurring Deposit
Current Deposit
Fixed Deposit

11. Cheque
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•Achequeis a paper instructing the bank to
pay a specific amount from the person’s
account to the person in whose name the
chequehas been issued.

12. Loan Activities of Bank
•Banks in India these days hold
about 15% of their deposits as cash.
•Bank use the major portion of the
deposits to extend loans.
•Difference between the interest
rates is the main source of income
forbanks.
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13. Credit
•Credit refers to an agreement in
which the lender supplies the
borrower with money, goods or
services in return for the promise of
future payment.
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14. Two
Different
Credit
Situations
Positive
Situation
(improve)
Negative
Situation
(Debt
trap)
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15. NAVYA RAI
Terms
of
Credit
Collateral
Document-
ation
Interest
Rate
The mode
of
repayment

16. NAVYA RAI

17. Difference between Formal
and Informal Credit
Formal sector loans:
•(i)Loans from banks
and cooperatives.
•(ii)Under
supervision of the
Reserve Bank of
India.
•(iii)Reasonable rates
of interest.
Informal sector loans:
•(i)Loans from
moneylenders,
relatives, friend,
traders, etc.
•(ii)No supervision of
any institution.
•(iii)Very high rates
of interest.
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18. Loans Taken by Urban households
in 2003
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19. Role of
RBI
Issues
Currency
Foreign
exchange
Managem
ent
Superviso
r of other
Banks
Bankers
bank
Monetary
Policy
Banker to
the
Governme
nt
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20. Self-Help Groups for the Poor
Poor households are still
dependent on informal sources
of credit because of the
following reasons:
1.Banks are not present
everywhere in rural India.
2.Even if banks are present,
getting a loan from a bank is
much more difficult as it
requires proper documents
and collateral.
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21. Self Help Groups
•To overcome these problems, people created Self
Help Groups (SHGs).
•SHG are small groups of poor people which
promote small savings among their members.
•A typical SHG has 15-20 members, usually
belonging to one neighbourhood, who meet and
save regularly.
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22. Advantages of Self Help Group (SHG)
1.It helps borrowers to overcome the problem of
lack of collateral.
2.People can get timely loans for a variety of
purposes and at a reasonable interest rate.
3.SHGs are the building blocks of organisationof
the rural poor.
4.It helps women to become financially self-
reliant.
5.The regular meetings of the group provide a
platform to discuss and act on a variety of
social issues such as health, nutrition,
domestic violence, etc.
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23. GrameenBank of Bangladesh
•GrameenBank,
Bangladeshibankfounded
by economistMuhammad
Yunusas a means of
providing smallloansto
poor individuals.
•In 2006 Grameenand
Yunuswere awarded the
Nobel Prize for Peace.
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24. Thank You
By : NavyaRai
NAVYA RAI