In the first International Savings Bank Congress (World Society of Savings Banks) held on October 31, 1924 in Milano of Italy, Prof Fitippo Ravizza declared the day as the World Savings Day to celebrate the people who made savings as their hobby and habit.

The idea behind the declaration is to inform the people all around the world about the idea of saving their hard earned money in a bank rather than keep piling under the mattress with no additional benefit.

The concept of 'money earns money’ was popularized which provides the individual extra income along with a standard life without any physical effort and a secured economy to live. Money plays a dominant role in today’s society and the well being of a person is judged by his income, savings and investment.

 The Scripbox’s survey  conducted ahead of the World Savings Day on ‘wealth and well being’ during the lockdown period revealed that 90 per cent of the respondents identified financial health had profound impact on their well being.

Household financial savings refer to currency, bank deposits, post office small savings, debt securities,?mutual?funds,?pension funds, insurance, and investments in schemes and the total of these savings is known as gross household financial savings. 

Net household financial savings is arrived once the financial liabilities, including loans from banks, non-banking financial companies and housing finance companies, are subtracted from gross savings. These savings find their way to the capital market to invest in the industry which further help in creation of jobs.

New jobs create new savings accounts and help in pumping in new capital into the economy. Thus an economy thrives upon the saving habits of its citizens and a good savings percentage turns the country into a developed one.

A sustainable growth of the economy is possible when savings habit thrives in the society and the citizens contribute their savings in proper investment. There are two types of personal savings - voluntary and involuntary. Voluntary abstinence from consumption by people out of their disposable income comes under voluntary savings and savings without desire or willingness comes under the forced or involuntary savings.

Purchase of life insurance or investment in PPF or NPS for tax rebate are examples of involuntary savings. Both are of prime importance for the economy as the banking and insurance sectors are the two pillars of an economy and of great importance for the economic growth of the developing countries.

Both the sectors play a crucial role in building the financial market in the country but their very base is linked to the savings generated in the country.Let us examine the status of banking and insurance sectors in the State of Odisha which reflects the savings status of the people.

As per the basic statistical returns of scheduled commercial banks in India published by RBI from time to time, the total deposits by the scheduled commercial banks in India stood at Rs 45, 61, 000 crore and by the end of March, 2010, it increased to Rs 126, 39, 009 crore by March 2019 witnessing a growth of 177 per cent.

The total deposits of eastern region grew from Rs 52, 7300 crore to Rs 167, 5,417 crore during the period marking an increase of 218 percent.

The total deposits by scheduled commercial banks which stood at Rs 82, 400 crore in 2010 reached Rs 30, 9,554 crore by 2019 marking a growth of 276 per cent.

The data reveals the growing consciousness of the people of the Odisha State in opening bank accounts and parking their savings in their bank accounts.

There was a considerable growth in the number of commercial banks in the State of Odisha in the last decade. The number of the branches increased from 86,960 in 2010 to 1,45,374 by 2019 marking a growth of 67 per cent. The number of branches in the eastern region swelled from 14,359 in 2010 to 23,264 by 2019 with a growth of 62 per cent whereas Odisha witnessed a growth of 71 per cent during the same period from 2,876 commercial branches in 2010 to 4,914 branches as at the end of March 2019.

But in the sphere of Regional Rural Banks (RRB), Odisha displayed a dismal growth during the last decade. The growth of the number of RRBs at the national level witnessed 44 per cent, at the eastern region level 24 per cent and at the State level it stood at 14 per cent.

The deposits of the RRBs also witnessed lower growth in comparision to the regional and national levels. The RRB deposits marked a growth of whopping 270 per cent at the national level, 155 per cent increase at the eastern region level and 125 per cent growth at the State level during the period from 2010 to 2019.

The new life insurance business underwritten in the State in 2013-14 stood at 15,65,226 policies with a premium income of Rs 1,613.25 crore.

 But though the number of policies decreased to 13,59,272 in 2018-19, the amount collected grew by 97 per cent and stood at Rs 3173.76 crore.The number of private life insurance offices in the State stood at 219 in 2013-14. The number increased to 255 in 2018-19.

 The number of branches of LIC of India operating in the State in 2013-14 was 144  and they increased marginally to 147 in 2018-19 adding two more branches during the six years period.

The total number of life insurance branches increased from 363 to 402 adding 39 branches during the period of six years.

The life insurance agents play a great role in procuring life insurance business there by channelizing the savings in to the insurance sector. The number of agents of private insurance players which stood at 44,121 in 2013-14 decreased to 42,715 in 2018-19. On the other hand, the agents of LIC of India increased from 33,533 to 42,893 during the same period adding 9,360 agents.

The total life insurance agents in the State increased from 77,654 to 85,608 during the six years period which is a good indication of the initiatives of the public sector insurance monolith - LIC of India.

To tap it all, let's be convinced that income minus expenditure is not savings but income minus savings should be one's expenditure. One must predetermine the amount of savings so that accordingly he will adjust his expenditure and the desired amount he can save to fulfil his financial goals.

(Dr Biswal is Head, Department of Commerce, Nowrangpur College. Mob: 9437125286. bhaskarnathbiswal@gmail.com)