Formal sector loans can be made beneficial for poor farmers and workers in the following ways: . It is required to create awareness among farmers about formal sector loans. . Process of providing loans should be made easier. . It should be simple, fast and timely. . More number of Nationalised banks/comparative bank is should be agreed in rural sector. . Banks and cooperatives should increase facility of providing loans so that dependence on informal sources of credit reduces. . The benefits of loans should be extended to poor farmer and small scale Industries. . While formal sector loans need to expand, it is also necessary that everyone receives these loans.