Why do most of the rural households still remain dependent on the informal sources of credit?

Why do most of the rural households still remain dependent on the informal sources of credit?

Ans.
(i) Limited availability of Banks in rural areas.
(ii) People in the rural areas face problem with regard to documentation.
(iii) Absence of collateral is one of the major reasons which prevents the poor from getting bank loans.
(iv) Rural people get easy loans from the richer households through informal ways.
(v) Any other relevant point.