Chapter-Chapter 3. Money and Credit Economics class 10 in english Medium CBSE Notes

Chapter 3. Money and Credit

Money plays an important role in our daily lives by making the exchange of goods and services easier. Modern banking systems provide various financial services such as saving, borrowing, lending, and transferring money. This chapter explains the functions of money, the role of banks, credit, and the importance of formal financial institutions in economic development.

CBSE Notes – Key Points

This section provides important concepts, keywords, facts, and exam-oriented points for quick revision.

Important Terms

• Money
• Medium of Exchange
• Double Coincidence of Wants
• Barter System
• Credit
• Loan
• Collateral
• Interest
• Debt
• Formal Sector Credit
• Informal Sector Credit
• Reserve Bank of India (RBI)
• Bank Deposit
• Cheque
• Demand Deposit

Important Facts

• Money acts as a medium of exchange.
• The barter system suffered from the problem of double coincidence of wants.
• Banks accept deposits and provide loans.
• Demand deposits can be withdrawn whenever required.
• The Reserve Bank of India regulates the banking system.
• Formal credit is safer and cheaper than informal credit.
• Credit helps increase production, income, and employment.

Important Concepts

• Barter System
• Functions of Money
• Modern Forms of Money
• Bank Deposits
• Credit
• Terms of Credit
• Formal and Informal Sources of Credit
• Role of RBI
• Self-Help Groups (SHGs)

Exam Important Points

• Meaning and functions of money.
• Problems of the barter system.
• Demand deposits and their features.
• Functions of commercial banks.
• Terms of credit.
• Difference between formal and informal sources of credit.
• Role of the Reserve Bank of India (RBI).
• Importance of Self-Help Groups (SHGs).

Quick Revision

• Money eliminates the problem of double coincidence of wants.
• Demand deposits are payable on demand.
• Banks accept deposits and provide loans.
• Collateral is an asset kept as security against a loan.
• RBI is the central bank of India.
• Formal credit includes banks and cooperative societies.
• Informal credit includes moneylenders, traders, friends, and relatives.
• Self-Help Groups improve access to credit in rural areas.

Exam Tips

• Understand the difference between the Barter System and Money.
• Learn the functions of money with examples.
• Remember the features of demand deposits.
• Study the role of banks and RBI carefully.
• Revise the differences between formal and informal credit.
• Prepare the advantages of Self-Help Groups (SHGs).

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