Lowest savings in the two big cities

Thirty-three per cent households maintain monthly savings in city corporation areas, according to a survey of Bangladesh Bureau of Statistic (BBS).

Each household, on average, makes a savings of Tk 3,961 a month and Tk 47,542 a year, the survey said.

The survey was conducted in Dhaka North City Corporation, Dhaka South City Corporation, Chattogram City Corporation, Rajshahi City Corporation, Sylhet City Corporation, Khulna City Corporation, Barisal City Corporation, Rangpur City Corporation, Mymensingh City Corporation, Gazipur City Corporation, Narayanganj City Corporation and Cumilla City Corporation.

According to the survey, the rate of savings per household is nearly double in nine city corporation areas than that of Dhaka North, South and Chattogram city corporations. People living in Dhaka North, South and Chattogram cities prefer to make savings in banks while residents of other nine cities mostly chose non-government organisations (NGOs).

It shows 28 per cent of households made savings in Dhaka South, North and Chattogram city corporations while 52 per cent of households do so in other city corporations.

In Dhaka and Chattogram cities, 47 per cent of households make their savings in banks, 27 per cent in NGOs, 8 per cent in associations and 5 per cent of households maintain their savings at insurance companies.

The scenario is quite opposite in other city corporation areas with 46 of per cent households making their savings in banks and 29 per cent in banks.

Regarding this, Ahsan H Mansur, executive director at Policy Research Institute, said even if 33 per cent of households made savings, that is very low. The rate should increase. It is understood that except for the rich, others can’t save much because of the high rate of house rent in city corporation areas. The price of daily essentials is also high. People don’t have much left to save after spending on house rent and daily essentials.

The survey titled “Urban Socioeconomic Assessment Survey” was conducted from 14 to 26 December of 2019. As many as 1,075 households were selected from Dhaka and Chattogram city corporations and another 1,075 households from nine other city corporations through random sampling.

Focal point officer of the survey, Alamgir Hossain, told Prothom Alo that the cost of living is higher in Dhaka and Chattogram city corporation areas compared to other city corporation areas. That is why the two biggest cities of the country see the lowest rate of savings and other cities has a higher rate.

The BBS study said people living in cities has a habit of saving as well as taking loans from various sources. They mostly depend on the NGOs for loans and this is more prevalent in the cities except for Dhaka and Chattogram. Some 53 per cent households take loan from NGOs in Dhaka and Chattogram cities while 71 per cent in other nine city corporations. Twenty per cent of households take loans from friends and relatives in Dhaka and Chattogram cities and 8 per cent in other city corporations. Twelve per cent of households in Dhaka and Chattogram and 7 per cent in other nine city corporations bring loans from various associations.

According to the survey, 42 per cent of households have access to smartphone in Dhaka and Chattogram cities and 47 per cent in other cities. Some 0.27 of households own a motorcycle in Dhaka and Chattogram cities and 10 per cent in other city corporation areas.

This report appeared in the print and online edition of Prothom Alo and has been rewritten in English by Hasanul Banna