It is not difficult to imagine the problems of rising inflation and rising costs when it reaches the family kitchen. When the salary received at the beginning of the month is gone in a few days, it becomes difficult to meet the expenses of children’s education and they have to ask others for money to run the household, it is not just a family’s story. A large number of families in Bangladesh are facing the same situation.

Recently, a report on the financial status of ordinary families in Bangladesh has come out, in which the financial challenges of families can be seen. Taking a loan in Bangladesh is no longer limited to illness, marriage or any major emergency, but people have to borrow to meet their daily needs. Worries about paying off loans also put pressure on next month’s budget. In such a situation, the question arises, why is there such a huge gap between the income of the common people and their expenditure?

Half of households are burdened with debt

The seriousness of the situation is reflected in reports of households taking out loans to meet household expenses in Bangladesh. Nearly half of households are in debt, meaning financial pressure has reached large sections of society. According to a special survey by the Bangladesh Bureau of Statistics (BBS), the average monthly income of a family in the country is Rs 33,513, while the average monthly expenditure has reached Rs 35,311. That means the family is spending about 1,798 taka more than the average income.

Why do people have to take loans?

This difference may seem small, but if it continues to happen every month, the financial condition of the family becomes weak. Inflation is the main cause of this problem. If we look at the year 2022 report, the national average household income is found to be 32,422 taka and the national average expenditure is 31,500 taka. According to the report, debt burden on rural households is high. In the last one year, 51.91 percent of households in rural areas had to take loans to meet basic expenses.

How much has the poverty rate increased?

This figure was 40.19 percent in urban areas and 32.11 percent in corporation areas of cities. This shows that lack of income and limited employment opportunities in villages are adding to the problems of families. According to former World Bank economist Zahid Hussain, persistent inflation, weak economic growth and a decline in real wages have affected households. According to World Bank estimates, the poverty rate in Bangladesh may increase from 18.7 percent in 2022 to 22.5 percent in 2026.

Rising prices of food and other essential commodities affect the purchasing power of people. On the other hand, it becomes difficult for families to manage their budgets if salaries and earnings do not grow at the same pace. Forget saving, in such a situation people may have to seek help from friends, relatives or other sources of loans.