Where Can I Save My Money? Please Tell Me, My Lord!
By Nisha Biswas
14 May, 2013
Countercurrents.org
(Sarda scam compels to review the banking facilities for the marginalized and rural population.)
This is a true story. And like, every true story, this story is of many Kamalas, Suchitras and Kavitas who labor in our homes for pittances. All these Kamalas, Suchitras and Kavitas are born in families that are above Sarkari poverty line, but do not have the skills of Ms Sheela Dixit, Chief Minister of Delhi, to live happily in meager income of Rupees six hundred per month. Therefore, they start laboring from an early age in our homes. The age can be as young as five, but surely below eighteen.
We not only exploit them to the extent possible but also give them lessons on the importance of saving for rainy days and for a brighter future. These Kamalas, Suchitras and Kavitas can earn somewhere around three to five thousand, if they are working in South Kolkata and is half in they are in Northern part of the city for twelve to eighteen hours of hard work each day. This earning can be little more in Delhi and may be higher in Mumbai and Bangaluru. There is no leave for them, not even maternity is allowed. Risking their health, these Kamalas, Suchitras and Kavitas keep us healthy and provide us the opportunity to relax, gossip and the luxury of remaining unhappy and grumpy.
Kavita, now around twenty, can be few years more or less as no one remembers when was she born in a rickshaw puller family. All that her mother remembers is that it was six in the evening of a Friday of Ashad. Rickshaw puller father met an accident, probably when she was six or eight and could not go back to work, as family could not afford expensive treatment. Mother, whose baby son was only two, joined the women brigade, to take Lakhikantpur Local every day for washing and cleaning in gentlemen’s homes under the grumpy ladies.
Soon, Kavita joined the work force, initially to help mother and then to earn independently. After the days work, mother and daughter duo were regularly beaten by the disabled father, who had to stay at home and had to look after her younger siblings. As the violence became unbearable, Kavita thought that the match her father is insisting upon would give relief. First two or three months of marriage went well, on learning of Kavita’s pregnancy this fellow just disappeared. Kavita came back to her violent father with a baby girl. Kavita is not like many other girls of her age; she loves and values love, care and affection. With so many years of experience, she is yet to understand the cruel ways of this world. Kavita is a born fighter and a dreamer. I know her for more than fifteen years when we made friendship, while she was carelessly swinging her thin legs on a bottle-brush tree with her friend and presented me a bright red flowers. And from that day, it was always a giggling Kavita wishing me, whenever we crossed each other. On my part, I only spent few seconds asking her well-being.
We met off and on, but it was always a happy reunion. I appreciated her carefree nature. Then she disappeared for few years. Much later, I learnt that she went to work in Goa and then somewhere in Rajasthan. One day she was back, as always unannounced, once again looking for work. This time she promoted herself to cook and cooked for four or five families in the locality. She was happy; she was with her daughter and was able to save some money for her education, to whom she wanted to give a life, absolutely different from hers. She still loved flowers, moon and starry nights and always has lot of breams and stories to share. Her latest dream is to have a shanty of her own where she and her daughter could live joyfully.
Though I knew that she is saving money, but I never bothered to ask her where was it deposited? Two weeks ago, while exchanging pleasantries, I casually asked her if she too has put her money with chit-funds. And the answer was yes. She was depositing with one of such funds rupees four thousands for last fourteen months and is promised of Rupees ninety-four thousand after the expiry of eighteen months. She had also fixed her saving from Goa and Rajasthan for seven years with a promise of three fold return. For few days she remained unmindful, but people like Kavita cannot afford to grieve on the losses and are ought to continue with life.
This time, I insisted her to open an account with a bank for safe keeping of her savings. Incidentally, I live in a locality where on both side of a kilometer stretch, there are branches of at least ten public and private banks. My idea that to have a saving bank account with any of these banks the only requirement is a photograph, identity - proof and address - proof, proved faulty; courtesy Kavita. For poor banks too have different norms. If Kavita had been well dressed, appeared to be middle class, if she had been so called articulate and sophisticate, where she lives would never be the reason for refusal of opening a saving bank account. But she did not fit in these norms; therefore, because she lives in south twenty-four parganas, where some banks have branches, she cannot open an account in a branch out of her residence. Banks flatly refused, not bothering that her work place is near these branches and that opening and operating a saving account from one of these branches is a matter of convenience. At a branch, she was even asked to bring a ‘no-objection’ from the branch-manager of her area of residence.
Upon persistent arguments and on asking to produce the circular that prohibits her to have a saving bank account, in any branch of the bank and the veiled threats of reporting the matter to media, one bank agreed to open an account, and though she had address and identity proof in the form of Voter Card, she was asked to come next day with a copy of her ration-card as an additional address - proof. That is how now she has a saving bank account with a public bank. But the day two too was not uneventful. Once again, we had to restart day one’s arguments. It was a Monday and there was a queue of four more like Kavita, wanting to open an account. All of them, though lived in the same locality, with a proof of that, had already made multiple visits. One of them was Rajesh, a sweeper, known to many as the family worked in many homes, shops, police station and market, making his fourth visit. Rajesh’s application form was duly filled, he happened to live in the locality; had PAN, Adhar, Voter and Ration Card; tea stall owner, who supplied tea to the bank staff was his introducer; his cast and class was the biggest obstacle and that’s why he had to keep requesting the officials. In a column for date of birth, a tentative date of birth matching to age in voter’s card was filled. And, the bank official sought the proof of the same and expressed his inability in opening an account without. A new series of arguments started. Logic was that she was born at home and like many of us, when birth registration was not mandatory, she did not possess a birth certificate. Moreover, because she did not go to school, no proof can be provided. Therefore, branch-manager was brought into the scene. In her case, self-attestation of identity and address proof was not sufficient it was to be verified. Spending in total five hours in the bank, finally Kavita emerged victorious, with a deposit of rupees five hundred and an account number in her name, though she still have to cross the hurdle of having the pass-book in hand.
Rina, a student of class eight, discovered by a friend, lived on a footpath near Ballygunj Phari. The friend frequently passed her sitting away from the rest and studying. One day she found out that she was studying in a school. Not going into the details of her struggle, she did very well in Madhyamik exam and the news came in newspaper. Many people rewarded her with cash as token of appreciation. Her mother wanted to keep this money in bank, but Rina could never open an account because she not only had the proof of address, but also had no address. Footpath cannot be home!
The poor, ignorant of the ways of administration, are a scared lot in going to the places like banks, post offices that have a polished look. And when somehow they do reach there, instead of being attended are being pushed off. Before the implementation of new economic policy, there were men/ women with note books in hand, agents from post offices, collecting the savings of small vendors and people like Kavita in market places and depositing them in their accounts. It was interesting to watch them and how they used to pursue small savers to part of a little amount of their meager income. There was a touch of personal relationship and concern for each other. These agents were reliable and used to get commission on collection. With liberalization, commission reduced to such a minimal that these agents disappeared. Now one rarely comes across any of them even in post office. Like all other relationships, here too we lost precious personal touch. Though in every field of work, valuing personal relationship is in decline; we do appreciate when someone helps us, exchange pleasantries; not like we encounter daily, where one is polite, gentle, courteous but is expressionless, as if this too is a part of an application/request that one is making and is being attended to. Where, all the policies are targeting middle class, poor are left to fend themselves.
After Sarada fall out, many are accusing Kavita and others like her of their greed. Customers in the bank too are unhappy to see them in their banks, where only people like them should be catered, and are complaining of the crowd, ruckus and sweat. In such a situation, what other options can they have than to fall prey to mushrooming, scrupulous chit funds whose agents are everywhere? The purpose of this writing is not to make a case in favor of chit funds but is to show how the state policies have systematically marginalized people on margin.
Profit and loss factor entered in all spheres of life in a big way with the implementation of new economic policy of financial liberalization. More than a thousand rural branches were closed in the areas under the population of 10,000, within the first five years of the implementation of new economic policy (1). 2,723 rural bank offices were closed between March 1994 and March 2000 (2). The argument given for the closure is that banks find it unviable to maintain branch. Though no rural branch was closed in West Bengal but there was not a single addition as well to cater increasing rural population or bringing in new areas under the banking services (3). The national average of the ratio of growth of rural branches to the growth of population for 1995 to 2005 is negative (-0.2) and though in next three years become positive but is only 0.5 (4) that has systematically starved the rural economy. It took more than a lakh of “farmer suicide” for Reserve Bank of India to realize the faulty banking policies. In March 2010, the then Finance Minister Mr Pranab Mukherjee urged Bankers to change mindset to reach out to the unreached and under reached segment of population. Mr Mukherjee asked them to harness technology and innovative low-cost business model to accomplish the target in 600,000 villages across the country (5) . Financial inclusion plan, made mandatory by RBI, is still a matter of discussion and is a subjects of Seminars. Growth in rural branches is much less than to the growth of semi-urban, urban and metropolitan branches, though RBI on 19th June 2012, circulates its roadmap-provision banking facilities in villages with population below 2000 (6) .
The effectiveness of KYC (Know Your Customer) policy in preventing money laundering and financial terrorism activity is frequently questioned, but is extremely effective in keeping marginalized away from formal banking. Theoretically, a person can open a small saving (no-frills) account, where one can keep aggregate balance not exceeding Rs 50,000 in a year, without fulfilling specified KYC norms (7) but no bank does that.
Policies of financial inclusion, holding financial literacy camps for rural population, fact is for marginalized like Kamalas, Suchitras and Kavitas the formal banking services is a distant dream, they are generally left with no other options than to keep their savings with scrupulous chit funds like Sarda and lend from Mahajans, for being cheated. Targets of providing these facilities to the unreached or under-reached remain illusive targets.
About the author
Nisha Biswas, based in Kolkata, is by profession a scientist and is involved in people’s movements.
Notes
1. Chavan, Pallavi (2005), “Banking Sector Reforms and Growth and Distribution of Rural Banking in India,” in V. K. Ramachandran and Madhura Swaminathan (eds.), Financial Liberalization and Rural Credit in India, Tulika Books, New Delhi.
2. S L Shetty, 1997. Financial Sector Reforms in India: An Evaluation, Prajnan, 25 (3-4): 253-287.
3. Reserve Bank of India (2008), Report on Trend and Progress of Banking in India, Mumbai.
4. Chavan Ramkumar& Chavan, Pallavi (2011), “Changes in the Number of Rural Bank Branches in India, 1991 to 2008”, Review of the Agrarian Studies, 1(1), 141 - 148
5. Financial Express, March24, 2010
6. RBI/2011-12/606 RPCD.CO.LBS.BC.No. 86/02.01.001/2011-12
7. http://www.nabard.org/pdf/Model%20%20KYC%20AML%20Policy.pdf
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