This report on CSES study was published in The New Indian Express on 26th August 2013
With the drastic decline of credit services offered by mainstream banks to the urban and rural poor, a special ‘guest’ has become an inevitable part of their socio-economic life in Ernakulam district. The money-lending ‘guests’ are known by the day on which he pays a visit to the households to collect the weekly interest.
The field reality is a fitting testimonial to the recently published study by Centre for Socio-Economic and Environmental Studies (CSES) Kochi titled ‘How The Poor Manage Their Finances: A Study of the Portfolio Choices of Poor Households in Ernakulam District’.
The study on behalf of RBI had found that “one fourth of the loans and the loan amount are provided by the moneylenders”.
They are addressed as ‘Velliyazchakaran’ (Friday man) and ‘Budhanazchakaran’ (Wednesday man) in the Chellanam coastal belt while in the regions on the Alappuzha border, they are known as ‘Saniyazchakaran’ (Saturday man) or ‘Chovvazchakaran’ (Tuesday man). Interestingly, in the Dalit colonies surrounding Kakkanad, the ‘guests’ pay a daily visit, which shows that the deprived sections are increasingly becoming outcast from the mainstream credit institutions.
Showing various colours of small cards issued by moneylenders, Kumaran, a Dalit construction worker near Kakkanad, said “I have six different cards. The agents of different moneylenders come to my home six days a week. As I was denied loans by mainstream banks citing my incapability to repay them, I’m forced to depend on moneylenders.”
“Due to the economic slowdown, several workers are struggling to get job daily. To meet daily expenses as well as emergencies these moneylenders are a huge relief. Unlike the banks, they don’t seek your assets. But they help us tide over the immediate crisis,” he said.