Directions Read the given statement and with that information answer the following question carefull...........

Logical Reasoning(IBPS CL) Statement and Infrence

Directions: Read the given statement and with that information answer the following question carefully:

After GST and demonetization, rising interest rates are set to hurt SMEs. Interest rates for loans against property (LAP) extended to small and medium-sized enterprises (SMEs) are set to rise in the coming months of 2018. ‘Rising interest rates, in addition to the muted operating environment for small businesses in India, will lead to an increase in delinquencies on LAP extended to SMEs’. The introduction of the goods and services tax (GST) in July 2017 and the government's demonetization policy have placed stress on the SME sector, which rising interest rates will exacerbate.

Which of the following can be logically inferred from the statement above?

This questions was previously asked in

IBPS Clerk Main (8th Oct 2022)

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In addition to rising delinquencies over the last few years would force lenders to be more cautious while underwriting loans. This would limit refinancing options, adversely affecting existing borrowers.

But losses will be limited because these loans are secured and have relatively low loan-to-value ratios.

Rising interest rates will limit refinancing options and increase repayment amounts, increasing risks for asset backed securities (ABS) backed by LAP to SMEs.

The ABS (asset backed securities) backed by LAP extended to SMEs have non-amortizing cash reserves, substantial excess spread and the possibility to extend the life of the loans and hence the life of the transactions

None can be inferred

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