Abstract
Urban debt is a less studied area. In many cases, it is a spillover of rural farm debt. As lands and assets get eroded in rural areas, urban migration takes place in search of livelihoods. People who move to cities crowd into slums, take up whatever daily employment is on offer and form the bulk of the informal or unorganised workforce in cities. Their occupations are unregulated and beyond the pale of any legal protection. With low earnings and even lower savings, they have to contend with expenses of contingent nature like major illnesses and hospitalisations as well as expenses related to weddings, deaths and other obligatory ‘social’ expenditure which leads them into a vicious cycle of debt. The nature of their work precludes loans from banks, further luring them into unregulated and usurious debt traps. This study, a part of a larger study conducted in 2014, studies the prevalence of debt among informal sector workers, examines and quantifies the major expense patterns, sources of funds and availability of credit along with cost of such credit.
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