Money Lender

A money lender is a person or organization who lends out money to individuals at a high interest rate. They are different from banks or other such financial institutions as the rate of interest is high in comparison to them as there is a risk involved. People who borrow money from moneylenders are generally people who have a poor credit history or who don’t have access to banks.


Generally gamblers and shopaholics are the people in the city who use this service.  The moneylender take advantage of their addiction and make money. Their sole idea is to make money out of this profession. They take risks in life in order to get good returns.

Generally moneylenders are crude in nature as they have a very materialistic nature and they have no consideration for human emotions. They always lend money to people who appear gullible to them.

Generally governments have rules in order to regulate the working of this money lenders.  In developing countries, money lenders are favoured in comparison to commercial banking services. Generally money lenders can be divided into two types: First, those who need guarantee in exchange of the money and second in which no guarantee is needed.


Guarantee can be of various kinds itself. Guarantee is something that the moneylender can confiscate if the borrower fails to pay back the money in the agreed time period. That something generally is greater than or equal to the amount being borrowed. Generally things given as guarantee are property, business, jewellery, vehicle or other materialistic objects. The money lender can do whatever he/she wants with the guarantee if the lender fails to pay him back. He/she can sell the thing or keep it for themselves.

The second type is found rarely as given the risk involved people generally look for guarantee.

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