'63pc of coastal poor households borrow from local moneylenders’

A recent survey finds that about 63 per cent of coastal poor households have borrowed loan from local money lenders at high-interest rates due to absent of institutional credit facilities, reports UNB.

The survey also finds 57 per cent of households are suffering from food crisis because of the lockdown, and about 46 per cent of households have experienced increasing violence against women.

The monitoring and research department of the COAST Trust, a Bangladeshi NGO, conducted the survey.

COAST Trust conducted the survey in eight coastal districts to know the impact on the livelihoods of poor people of the coastal areas because of the lockdown announced in the country to prevent the coronavirus infection.

Rezaul Karim Chowdhury, executive director of the COAST Trust, said that a local money lender allegedly killed a poor man recently in Kutubdia of Cox’s Bazar as the man had failed to repay the loan he had taken.

“We conducted this survey to understand the plight of low-income people for lockdown. COAST Trust has so far donated about Tk 2 million from its fund to the relief fund of nine coastal districts and 49 upazila administrations to help hapless people,” he said.

According to the COAST Trust’s monitoring and research department, the survey collected data from 240 poor, women-headed, and low-income families under 12 branches of the organization in six districts, including Chattogram, Noakhali, and Barisal. Around 83 per cent of respondents live in villages and 17 per cent in cities and 57.3 per cent of respondents are women-headed families.

According to the survey, 42 per cent of families can get meals for 3 times a day, which is normal. Some 52 per cent of families are eating twice a day and 5 per cent of families are taking one time meal per day. Around 56 per cent of families used to eat regular protein i.e. fish, meat, or eggs 3-4 days a week which came down to 13 per cent because of lockdown. Around 87 per cent of households now consume such protein 1-2 days a week.

Because of the lockdown, 34 per cent of households have lost their income completely, income has come down by one-fourth to 39 per cent, and half for 19 per cent families. This picture is unique to women-headed families. Some 46 per cent of households have lost their income completely, income has dropped to one-fourth for 30 per cent of households.

Around 63 per cent of the households have taken loans from moneylenders at high-interest rates to cope with the crisis and 18 per cent of households have borrowed from relatives and 13 per cent of households have received no loan.

Some 48 per cent of households have broken down their savings in response to the crisis caused by the lockdown. Around 35 per cent of the families sold their cows and goats. Among women-headed households, 30 per cent of respondents said there was no way to break their savings, sell cows or goats or jewelry.

Around 54 per cent of respondents said that the lockdown has increased the incidence of violence against women in their families. In 82 per cent of households, abusive or abusive language was used. 9 per cent of households have raised their hands and 9 per cent of households have been pressured for dowry.

When asked what they plan to do if the lockdown continues, 78 per cent of households say they may need to take out a loan of high interest from an NGO or bank. If not, they will take a loan from a local moneylender at a high-interest rate. Besides, 38 per cent of households said that they should spend the remaining savings down. Some 20 per cent of households will sell cows, goats, or jewelry and 15 per cent will sell labor in advance to the local moneylenders, while in women-headed households, the rate is 18 per cent.

Around 94 per cent of households have sought various types of loan support from NGOs, which were closed during the data collection. Some 41 per cent of respondents asked for a new loan, 13 per cent asked for an ongoing loan increase and 43 per cent asked for a cooperative loan or financial support. Note that most of the borrowers will invest for their livelihood and 69 per cent of the families have sought relief from the government in this situation and 21 per cent of the families have sought cash support.

The department of monitoring and research of the COAST says, low-income people in the food crisis want to invest in small businesses to turn around. That is why they need a loan. In the absence of micro-credit or other institutional credit arrangements, they will have to borrow from local moneylenders at high-interest rates or will be more at risk of breaking up savings.

Around 94 per cent of households have sought various types of loan support from NGOs, which were closed during the data collection. Some 41 per cent of respondents asked for a new loan, 13 per cent asked for an ongoing loan increase and 43 per cent asked for a cooperative loan or financial support. Note that most of the borrowers will invest for their livelihood and 69 per cent of the families have sought relief from the government in this situation and 21 per cent of the families have sought cash support.

The department of monitoring and research of the COAST says, low-income people in the food crisis want to invest in small businesses to turn around. That is why they need a loan. In the absence of micro-credit or other institutional credit arrangements, they will have to borrow from local moneylenders at high-interest rates or will be more at risk of breaking up savings.