Money and Credit Test - 14

Hot Money: Money which flees quickly from country to country either in response to better earning or in apprehension of adverse circumstances. Much of the capital flight in recent times is due to 'hot money'. Indian currency is Legal Tender Money. It can be used to make payments of debt and it cannot be refused.
Look  at the following terms also:
Hard Currency: A currency, the exchange value of which is expected to remain stable due to strong performance by it in an economy, eg: Dollar.
Soft Currency: A currency, the exchange value of which keeps on fluctuating with respect to other currencies.
Flat Currency:Having Command of the Government(it is used in India).
Token Currency: Face value higher than internal value.

Micro-finance is a type of banking service that is provided to unemployed or low-income individuals, or groups who otherwise have no other access to financial services.

Self Help Group is an important instrument in the delivery of micro finance to the poor women for establishing micro enterprise.

A Self Help Group (SHG) is a financial intermediary committee usually composed of 10–20 local women or men who provide financial assistance to its members by providing them finance in the a minimal interest rate. Kerala was on the  top in the list of the states in India who availed credit through Self Help Groups (SHGs). 

Hot money is the flow of funds from one country to another in order to earn a short-term profit on interest rate differences and/or anticipated exchange rate shifts.

Microcredit is generally considered to have originated with the Grameen Bank founded in Bangladesh in 1983.

Muhammad Yunus is a Bangladeshi social entrepreneur, banker, economist, and civil society leader who was awarded the Nobel Peace Prize for founding the Grameen Bank and pioneering the concepts of microcredit and microfinance.

A term loan is a monetary loan that is repaid in regular payments over a set period of time. Term loans usually last between one and ten years, but may last as long as 30 years in some cases. A term loan usually involves an unfixed interest rate that will add additional balance to be repaid.

For term loans payable in installments, the limitation period is 3 years for each installments, starting on the due date of each such installments.

PMLA: Prevention of Money Laundering Act (2002)(2002).

A Self Help Group (SHG) is a financial intermediary committee usually composed of 10–20 local women or men who provide financial assistance to its members by providing them finance in the a minimal interest rate. It is a part of micro financing as the amount of the loan is very minimum due to small group of people. 

The major problems of rural indebtedness is that the Indian farmers borrows loan every year from the informal sources which charge very high rate of interest. Even the amount of the loan is very huge which the farmers are not able to repay from their annual earnings which creates a debt trap out of their life. 

If the credit facility applied for in a bank is rejected due to any reason, then it is the responsibility of the respective bank to state the reasons briefly on the loan application received by the bank from the account holder and on the disposal register thereafter.