Bengaluru’s poor, now out of cash, want pawn shops reopened

Under normal circumstances, the poor would find a way out by borrowing amongst themselves. But this is not an option as everyone is under severe distress.
Migrant workers in Mahadevapura. Pic credit: Senthil S and Maraa.

Different people wanted different concessions during the total lockdown that lasted till May 3. While some wanted basic necessities like grain, some others wanted liquor shops to open. There was a unique request that went completely unheard. It was from the poor who did not even have money for basic needs: This section wanted pawn shops in the city to open so they could sell their little possessions and jewellery for some petty cash.

The cash crisis among the poor in Bengaluru is so severe that Indira Canteens – where meals are served at the subsidised rate of Rs 10 per plate – has few takers. These canteens have lesser footfall after the government went back on its promise of providing free meals.

“When we went to the slums, almost three weeks back, people were already running out of their savings. Some migrants from UP wanted to return to their native places, but first they had to earn some money to be able to afford the journey home. As there is no work anywhere and in many cases, wages have not been paid, the poor are really struggling. Under normal circumstances, the poor that reside in slums would find a way out of borrowing amongst themselves, but this is also not an option as everyone is under such severe distress,” said Vinay Sreenivasa, an activist working with Naavu Bharateeyaru, a city-based social welfare coalition.  

Data released by the Stranded Action Workers Network (SWAN), a group of 100 volunteers who have been responding to distress calls from migrant workers across the country since March 27, says that only 259 of 16,863 stranded workers reported receiving any cash transfer from the government. The report, released on Labour Day, points out:

·  More than 97 % (out of 10,383) have not received any cash relief from the government

·  74 % of people have Rs 200 or less left with them

·  64 % of people have less than Rs 100 left with them. (This is out of 9,981 stranded workers)

The second highest number of stranded workers (4,736) that SWAN reached out to are in Karnataka. While they continue to work for migrant workers – who have started to leave Bengaluru in the last couple of days – SWAN has “been receiving an increased number of calls from the non-migrant urban poor in Bengaluru,” pointed out Seema Mundoli, who is coordinating relief in the South.

Besides from Bengaluru, SWAN is receiving calls from Gulbarga, Raichur, Mysuru, Yadgir and Chickamagalur from both inter-State and intra-State migrants. Apparently, the demand for cash and other SOS calls are increasing, Seema said.

“Poor locals are in such a dire situation that they are demanding that the state government open up local pawn shops so they can earn some petty cash by selling their possessions and jewellery,” said Issac Amruthraj, convenor of Slum Janara Sanghatne.

Issac also suggested regulation of informal lenders and microcredit financiers who, he said, are harassing poor workers employed in the informal sectors for recovery of loans.

Another crisis was seen being played out this weekend as hundreds queued up around Central Bus Station in Majestic, the city’s transport hub, after the government opened some bus routes to ferry stranded migrant workers on Friday. The catch, however, was that the Karnataka State Road Transport Corporation (KSRTC) decided to charge exorbitant rates to people who had not earned for nearly 40 days.

Many who had walked long distances while carrying all their belongings to board these buses for passage home had no choice but to turn back as they were unable to afford the bus tickets. 

 “We went to the bus stand to enquire about the situation. We met someone who wanted to go back to their native place in Anantapur in Andhra Pradesh but as there was no direct bus there, he planned to go to Ballari. He needed Rs 850 for the ticket but had only Rs 500 with him. Most were still unable to afford tickets,” explained Vinay.

As public outcry grew, the government buckled and in a welcome announcement on Sunday (May 3), declared free bus services for ferrying migrants till May 5. The same was later extended till May 7.

The Jan Dhan quagmire

The Rs 1.70 lakh crore financial package announced under the Pradhan Mantri Garib Kalyan Yojana (PMGKY) on March 27 appears to have brought little relief. One of the main schemes under this — depositing of Rs 500 to the Jan Dhan accounts of all women (20.6 crore accounts) for the next three months — has come in for much criticism. 

According to recent data, one in every five Jan Dhan accounts or roughly over 7 crore accounts are ‘inoperative/dormant’, meaning there has been no transaction in the account for over two years. 

Activists have pointed out that Rs 500 is not enough to help poor households meet their needs for a month. Additionally, a recent study from researchers from Yale University estimates that more than half of poor women in India are likely excluded from the cash transfer program. The study further points out: 

·   26% of poor women live more than 5 km away from their nearest banking point. 

·  Only 75% or 150 million of the 200 million PMJDY accounts belong to poor women.

·  Many women do not know their accounts are PMJDY accounts, which could complicate access and withdrawals.

The findings of the study are also consistent with media and academic reports on the subject. For instance, the death of a 62-year-old woman was reported in Jharkhand on April 19 due to heat and exhaustion while waiting in the queue for about two hours at a bank to draw Rs 500 from her Jan-Dhan account. 

Long queues outside banks, often in violation of social distancing guidelines, are a reality in rural areas in several states, including Karnataka and have raised concerns of further spread of the virus. Karnataka has 1.45 Crore Pradhan Mantri Jan Dhan Yojana accounts as of 12/06/2019, according to Lok Sabha data.  According to SWAN data, only 20 (out of 16,863 workers across the country that they spoke to) reported receiving the Rs 500.

“There can be many reasons associated with this. A significant chunk of the poor may not have Jan Dhan accounts and it may also be possible that many may not have received any money into their account,” said SWAN’s Rajendran Narayanan, a faculty member at the Azim Premji University, Bengaluru.

An additional problem with Jan Dhan accounts is that some have been unused for a long time and hence some users are experiencing additional cess charges for maintaining minimum balance. The RBI needs to issue a strong directive to not have minimum balance restrictions.

Second, the governments need to maintain records of migrants from various places and ensure that cash transfer can be done to any kind of account. Cash could also be given based on self-identification, Rajendran said.

Meeting the Cash Emergency

Despite easing of some lockdown restrictions, cash-generation will continue to be an issue as many occupations the poor are involved in are unlikely to resume immediately.

While the idea of a Universal Basic Income (UBI) is floating around, the Congress party has recommended cash transfer of  Rs 7,500 to bank accounts of all those covered under the Pradhan Mantri Jan Dhan Yojana, PM-Kisan scheme and pension accounts, including those of elderly, persons with disability and widows. 

Bihar and Jharkhand initiated schemes based on mobile application technology, but have had mixed levels of success due to a host of technical issues and difficult preconditions. Tamil Nadu and Andhra Pradesh have provided Rs 1000 to all PDS holders, according to Vinay. 

SWAN has recommended emergency cash relief of Rs 7,000 per month for at least 3 months (without biometric authentication) to each poor household/migrant worker and minimum wages for 25 days per month into Jan Dhan accounts of all urban residents for the period of the lockdown and two months following the end of the lockdown.

The researchers at Yale too believe “extending transfers to banked women who don’t own a PMJDY account would substantially increase inclusion”. 

Activists on the ground in Bengaluru have also suggested some radical ideas. Advocate and labour rights activists, Clifton Rosario, suggested a COVID cess or a ‘super-rich tax’ to guarantee cash assistance and wages to the poor.


  1. Vadaken says:

    Indian Government is liable to pay cash transfers only to indian citizens and not to Bangladeshis or Rohingyas. True law abiding citizens of India has opened bank accounts as per the government notification. People who are poor, needy and require rations have ration cards are fully utilising it. One cannot cry of isolation, when the going is tough. All these shouting are from the illegal immigrants of other countries

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