Nearly Half of All Households Bear the Burden of Debt to Run the Household: Expenditure Exceeds Income, Rural People under the Most Pressure

Nearly half of the country’s households have to run their households on loans. This situation has arisen as the cost of living has increased and incomes have stagnated. This worrying picture has emerged in a special survey by the Bangladesh Bureau of Statistics (BBS).

According to the survey’s data, 47.42 percent of households in the country are indebted. Among them, rural households are under more pressure than urban ones. At the national level, a household’s average monthly income is 33,513 taka, yet the average monthly expenditure per household is 35,311 taka — that is, expenditure is higher than income.

The survey was conducted during the time of the interim government, before the recommendations of the ninth National Pay Scale were prepared. The survey was carried out from 14 to 18 September last year at the request of the National Pay Commission.

The BBS’s Poverty and Livelihood Statistics Cell prepared the report titled ‘Living Standards Survey 2025’. Before that, data were collected through computer-assisted digital interview methods. A total of 3,000 households were interviewed from 150 primary sampling areas across village, urban and city corporation areas.

The BBS report says that in the past year, 51.91 percent of households in rural areas, 40.19 percent in urban areas and 32.11 percent in city corporation areas were forced to take loans to meet basic living expenses. The rate of taking loans in villages is clearly higher than in cities.

Compared with the 2022 Household Income and Expenditure Survey, the scale of the pressure becomes clearer still. At that time, at the national level, a household’s average income was 32,422 taka and its average expenditure was 31,500 taka — back then income was higher than expenditure. Now that picture has reversed.

In terms of expenditure, households’ average monthly expenditure is highest in city corporation areas, at 46,778 taka. In urban areas, the monthly expenditure per household is 37,344 taka, and in rural areas 32,532 taka.

The survey says that at the national level, half of a household’s monthly expenditure goes on food and half on non-food sectors. But the picture differs by region — in villages, expenditure is higher on food; in cities, higher on non-food sectors. 56.7 percent of the monthly expenditure of households in city corporation areas goes on non-food sectors.

Meanwhile, for 56 consecutive months until last September, the wage growth rate was lower than inflation. According to the BBS wage index, last September the wage growth rate fell to 7.9 percent, which the previous month had been 8.05 percent. The BBS prepares this index by observing the wages of low-paid skilled and unskilled workers in 63 occupations in the agriculture, industry and service sectors.

The Bangladesh Development Update report published by the World Bank on 6 October says the main cause of the economic pressure is the surge in inflation continuing for four years, which has consistently reduced households’ purchasing power. Living standards are being harmed by the prolonged economic slowdown, weak labour demand and continuing inflation.

According to World Bank calculations, the poverty rate in the country could rise from 18.7 percent in 2022 to 22.5 percent in 2026. In the same period, by the international poverty line of 3 dollars a day, the extreme poverty rate has risen from 5.9 percent to 10.1 percent. As businesses’ production capacity fell due to the energy crisis, the creation of new employment in the industrial sector has also been obstructed.

The private research organisation Power and Participation Research Centre (PPRC) said in a report last Saturday that in 2025, 27.93 percent of the country’s people were below the upper poverty line. To meet the shortfall in running the household, families are having either to take loans or to break into their savings.

Regarding the BBS survey, Selim Raihan, executive director of the research organisation SANEM, said high inflation has been going on in the country for four years, and the picture that has emerged in the survey does seem credible. In his words, people who are a little better off are now also taking loans, but their reasons are different.

Selim Raihan said poor people whose backs are against the wall take loans for food and drink, medical treatment and education expenses. At this time of a rising poverty rate, sluggish investment and no creation of employment opportunities, the number of indebted households is very worrying. To get out of this picture, effective progress in all three directions — income, employment and inflation — has now become the most urgent question.