Of course any developing entrepreneurs will have higher interest rates - they are greater credit risks, and the costs of making the loan are similar for small loans an large loans. To properly compare, you have to compare the the 24% rate to the previous lenders, who, if I remember correctly charged rates from 100-300% and up.
That's all well and good provided that the loan is unsecured and generous (i.e. humane) bankruptcy laws are available.
In India, bankruptcy means a rural farmer will lose everything, including his land and his seed corn.
You can't have it both ways. Either the loan is secured and farmers pay low interest rates.
Or a high rate is allowed because the loans is an unsecured loan with high credit risk.
But then the debter should be able to default without severe consequences, just a damage to his credit rating.
Neither is possible, because India doesn't know what humane capitalism is.
Edit: Sure 24% is better than 300%. So I should congratulate India for leaving the Feudal ages and entering the Robber-baron capitalist era of the 19th century.
Well OK: Congrats India! Now let's enter that 20th century, shall we?
You're posting many claims of this nature in this thread, but like my gran used to say 'when you're in a hole, stop digging'. Much of the West does not have what you call 'humane bankruptcy laws', most debts in most of Western Europe is non-dischargeable. The US is quite the outlier in this respect.
Furthermore, bankruptcy is not a counterbalance for high interest rates! It's a purely pragmatic tool, not a designed part of the system! It's very delicate to fiddle with what is fundamentally a relationship of trust between lenders and people taking loans through statute, and while improvements are possible everywhere, just saying 'India should have liberal bankruptcy laws' (i.e., discharging loans should be easy) is nonsense because the shocks this would cause in the financial system (at the micro level) would be severe and there's no telling if the long-term benefits (if any) will outweigh the sure short-term catastrophe.
