They end up paying most part of their profits as interest on money borrowed
The month of Ramazan might provide good business opportunities for small time traders, but not many manage to net good profits in spite of trading for extended hours.
The reason -- most of the traders pay up good part of their profits towards interest accrued on the money borrowed from money lenders. In fact, it is no more finance business but ‘chit fund’ business.
Money lenders now no longer offer ‘finance’, but they now run chit fund business yet another way to take away a good part of the money as ‘commission’ instead of interest. “They charge somewhere between Rs. 10,000 and Rs. 20,000 as commission for every Rs. 50,000,” says a trader who opts for it citing no other alternative.
It is no secret that hundreds of roadside and push cart vendors at the Pathergatti market approach money lenders for business investment. And the demand increases in Ramazan month when they require additional funds to stock more goods.
“Not all the traders depend on the financiers, but for most of the traders they are the only source,” reveals Mohd. Jameel Khan, a readymade apparels kiosk owner.
Much has been talked about putting an end to the menace, but not much has been done to address the problem. “They (money lenders) form an integral part of the business and remain inseparable until the government introduces some alternatives,” curtain trader Mohammed Asif says.
Interestingly, there is 100 per cent increase in the number of petty vendors on the stretches of Pathergatti, Shehran, Gulzar Houz and Lad Bazaar in the Ramazan month. This apart, many thoroughfares and areas like Edi Bazaar, Yakutpura Bada Bazaar, Hafeezbabanagar, Jhirrah and Sabzimandi are also a hub for them.
However, a section of the vendors enjoy the benefit of credit facilities at wholesale shops, but it is limited to a negligible slot. Mostly fruit vendors and readymade clothes sellers get this opportunity. “There is risk of fruits getting spoiled, so it is here that credit facilities are offered,” says Imtiyaz Ahmed, a fruit seller.