informal markets

Informal markets are economic activities that occur outside official, regulated channels. They include unlicensed vendors, street traders, and cash transactions not recorded by authorities. These markets often arise in response to limited access to formal employment, high regulation costs, or barriers to entering official markets. They can provide affordable goods and services, support livelihoods, and foster local entrepreneurship but may lack legal protections, safety standards, and consumer rights. While they complement the formal economy, their unregulated nature can pose challenges for taxation, quality control, and economic planning.