Flight to PSU banks, home dreams perish as income hit in lockdown

 A massive negative impact on income due to the lockdown is driving households to a flight to safety towards public sector banks while a large number of Indians now feel their hopes of purchasing a home of their own would remain a dream, as per the latest IANS CVoter Economic Battery Wave survey.

As the Covid-19 pandemic and the lockdown severely dented businesses across sectors, impacting the income of the common Indians for over two months, people are uncertain about their financial prospects.

The sample date is first week of June and the sample size is 1,397 and covers more than 500 Lok Sabha seats across the country. Every week a 1,000 plus new respondents are added to the tracker model.

There is a massive negative impact on household income since the lockdown was implemented, with more than half of the respondents indicating it.

As per the survey, 53.2 per cent of males said there is a negative impact on income. So either people are laid off, getting reduced salaries, forced for leave without pay or working only part time now. As many as 56.4 per cent females are earning less than before the lockdown.

The situation is grim in terms of survival without incomes and jobs. Almost half of India’s population will not be able to survive more than a month without any job or income with the help of savings or family support.

With a protracted lockdown and dismal economy, job losses are mounting and concerns are going up for families on how long they can hold out.

As per the IANS CVoter Economic Battery Wave, 28.2 per cent of males said they would survive less than a month without income while 20.7 per cent said they could survive for a month. At the more comfortable end of the spectrum, 10.7 per cent said they could survive without income for more than a year.

Also, a large number of Indians now feel their hopes of purchasing a home of their own would remain a dream.

The survey showed that around 24.6 per people in the middle-income group and 18.3 per cent in the low-income group feel a home of their own is beyond their reach now.

Interestingly, the despair persists despite the government’s latest announcement of extending the Credit Linked Subsidy Scheme (CLSS) for middle-income groups to buy affordable housing units for one more year till March 31, 2021.

This very feeling of incapability of purchasing a house is not limited to the low and middle-income groups, as the survey showed that nearly 7 per cent respondents from the higher-income group feel their plans of buying a home have been derailed.

Indicating a flight to safety, the survey shows that the Covid-19 pandemic and the lockdown has truly tested the preference of people for the banking system that provides safety for their savings with good service and better returns.

In this regard, the survey shows that public sector banks have got a thumbs-up from majority of the account holders who feel that their hard-earned money is safe there in comparison to private sector banks.

Private banks seem to be out of favour for the general public as account holders from across age and income groups, residing both in rural and urban areas, largely said that their trust on these banks have come down.

Even cooperative banks fared better in terms of the trust factor compared to the private lenders.

Around 12.7 per cent of the people aged above 60 years, who currently hold accounts in private banks, want to shift their accounts, out of which 12 per cent want to shift to cooperative banks and the rest 0.7 per cent are willing to shift to public banks.

However, a majority of the respondents do not plan to cut down on domestic services.

As per the survey, 60.9 per cent of the respondents across categories said they will continue to avail these services.

They were responding to a question on whether or not they planned to cut down on the services availed.

These services include domestic help, driver and cook, among others.

A total of 39.1 per cent of the respondents planned to cut down on these services.

Meanwhile,

most people believe that normalcy will be restored after the lockdown is lifted. However, they will still maintain precautionary measures to mitigate the risk of the Covid-19 infection.

The tracker showed that 55.6 per cent of respondents across categories said that normalcy will come back once lockdown is lifted.

They were responding to a question on whether or not they “think life will come back to normal once lockdown is removed?”

As many as 44.4 per cent of the respondents were either unsure or felt that it will take some months for things to normalise.