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World Savings Day- All You Need To Know About India's Savings Culture And More
Writer: Shweta Singh
She is a Journalism graduate from Delhi University, She has previously worked as a voice over artist for various cuisines and clothing brands. She is specialised in content writing, hosting anchoring and voice over.
India, 30 Oct 2021 11:51 AM GMT | Updated 30 Oct 2021 11:52 AM GMT
Editor : Snehadri Sarkar |
While he is a massive sports fanatic, his interest also lies in mainstream news and nitpicking trending and less talked about everyday issues.
Creatives : Shweta Singh
She is a Journalism graduate from Delhi University, She has previously worked as a voice over artist for various cuisines and clothing brands. She is specialised in content writing, hosting anchoring and voice over.
World Savings Day was established during the first International Savings Bank Congress (World Society of Savings Banks) in Milan, Italy on October 30, 1924.
India has an age-old tradition of saving up its more significant chunk of income rather than consuming it. Indians believe in saving up for the 'rainy day' today and saving up the maximum possible amount of their income to deal with future contingencies. Savings act as a cushion that absorbs extra expenses without making a hole in the pocket. On the other hand, allocating a significant part of income lowers the amount that remains to be spent on consumption.
The consumers thus adjust their budget to spend on increased mortgaged payments or better compensate if they lose their job. Higher saving tendencies of Indian household also explains their lower risk-taking abilities.
The Indian Savings Culture
The savings culture in India has changed drastically over a decade. While most Gen X and Gen Y have deferred their consumption of wealth, the millennials have started to consume more wealth than their previous generation. The prominent factors that have influenced this shift are better investment opportunities, credit and banking facilities: globalization and more inclination towards the western culture.
The History
A sneak peeks into the history could reveal a lot more facts on the saving nature of India. However, there was no unlimited data available on personal saving rates during the British reign. The 200 years of 'British raj' dried up the country's economy and exhausted India of its wealth. This is a reason for the then young India (the 1950s) to save up more. Post-Independence disposable income of the country was the lowest in history with 87 per cent of its GDP coming from the household. This pattern continued for a couple of decades. People invested the majority of their savings in gold immovable properties.
Later on, the millennials and Gen Y steered the economy. The savings were slowly replaced by the consumption of wealth aided by the phenomenal growth in the financial institution. There is an expected change in the savings trend-household savings, to be more precise.
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