INCREASED BORROWINGS BY THE INDIANS
A survey has been conducted on the details of the increasing amounts borrowed by the Indians, for various purposes. Front page of Times of India of Nov 15, 07 gives some interesting highlights from this report. The main finding appears to be that, people in India are borrowing for requirements for food, transport, medical bills, repaying earlier loans etc. Earlier people used to think that borrowing is bad, but it is not considered so now. It gives an indication of the changes taking place now. Besides obtaining several types of loans from the banks, people also borrow from relatives, friends and money lenders, even for routine expenses. Twenty one percent of rural households, as against only 7.2% of urban households, borrow from moneylenders also. Out of these 25% of the village borrowers and 33% of city borrowers do so, for general normal expenditures. Apart from general expenses, money is also taken on loan for social events like marriages, births and deaths in the family. Number of borrowers for building capital assets like house, car etc., is comparably very less. Desire to spend more, is leading many families to debt traps, since they are forced to take loan to repay earlier loans.