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Nanoplastics and microplastics (NMPs) are sneaky invaders, hiding in the tap water we drink every day. These tiny fragments of plastic have already been linked to unsettling changes in gut health and antibiotic resistance, raising alarm bells about their impact on our bodies. But here’s some refreshing news: scientists have discovered a surprisingly simple solution — boiling your water. <h2>A kitchen hack for cleaner water</h2>Researchers, led by biomedical engineer Zimin Yu, have found that boiling water and then filtering it can remove up to 90% of nanoplastics and microplastics from tap water. “This simple boiling water strategy can 'decontaminate' NMPs from household tap water and has the potential for harmlessly alleviating human intake of NMPs through water consumption,” the team explains. Even better? You probably already have the tools you need in your kitchen: a pot to boil water and a simple stainless steel mesh to filter out any leftover bits. <h2>How does it work?</h2>The trick lies in the build-up of limescale — or calcium carbonate — when water is heated. If you’ve ever peeked inside a kettle, you’ve seen this chalky layer. When water is boiled, calcium carbonate naturally precipitates out of the solution, forming a crust. This crust traps NMPs on its surface, making it easier to filter them out. “Our results showed that nanoplastic precipitation efficiency increased with increasing water hardness upon boiling,” the researchers write. For example, in soft water (low in calcium carbonate), the process managed to remove about 25% of NMPs. Meanwhile, in hard water (higher calcium carbonate levels), the process removed up to 90% of NMPs. <h2>The harder the water, the better the results</h2>Hard water, often considered a nuisance because of limescale, might actually be a secret weapon against microplastics. The researchers found that the harder the water, the more effective the boiling process was at capturing and removing plastic fragments. In water containing 300 mg/L of calcium carbonate, NMP removal reached an impressive 90%. Even at lower levels, such as 80 mg/L, over a third of the plastics were filtered out. Using a simple tea strainer or other household filters, these lime-encrusted plastic fragments can be easily removed before the water is consumed. <h2>Why it matters</h2>Microplastics aren’t just a problem for the planet — they’re becoming an intimate part of our daily lives. Previous studies have identified plastics like polystyrene, polyethylene, and polypropylene in drinking water. While the long-term effects on human health remain uncertain, the evidence suggests we’re better off without them. “Drinking boiled water apparently is a viable long-term strategy for reducing global exposure to NMPs,” the researchers say. For many, boiling water before drinking it is already a cultural norm. But the researchers hope their findings will encourage more people worldwide to adopt this practice as plastics continue infiltrating our water sources. The findings of this research have been published in Environmental Science &amp; Technology Letters and can be accessed <a href="https://pubs.acs.org/doi/10.1021/acs.estlett.4c00081">here</a>.

Worried about the harmful microplastics in your water? You just need to boil and strain it before consumption

Over the past few months, there’s been a lot of brouhaha about the lagging pace of bank deposits in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialization of household savings in the country, or the rising preference of Indians towards mutual funds and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian equity markets through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by <keyword id="20250971" type="General" weightage="20" keywordseo="franklin-templeton" source="keywords">Franklin Templeton</keyword>, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are <keyword id="4000333" type="General" weightage="100" keywordseo="household-deposits" source="Orion">household deposits</keyword> really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. Also, we can’t forego the fact that the share of Indian <keyword id="20319599" type="General" weightage="20" keywordseo="households" source="keywords">households</keyword> in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and savings account deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (<keyword id="19942037" type="General" weightage="20" keywordseo="central-board-of-direct-taxes" source="keywords">Central Board of Direct Taxes</keyword>) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of <keyword id="20930760" type="General" weightage="20" keywordseo="securities-transaction-tax" source="keywords">Securities Transaction Tax</keyword> (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell equity mutual funds, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by equities can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in deposit growth we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the <keyword id="19900043" type="General" weightage="20" keywordseo="fed" source="keywords">Fed</keyword> recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next <keyword id="19918491" type="General" weightage="20" keywordseo="mpc" source="keywords">MPC</keyword> (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day.

A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<div type="image" title="Are Indians depositing less money in banks, or more in mutual funds? Turns out, it&amp;#39;s neither of those." msid="113663806" hostid="261" sizebytes="1121785"></div> Over the past few months, there’s been a lot of brouhaha about the lagging pace of <keyword id="20202062" type="General" weightage="20" keywordseo="bank-deposits" source="keywords">bank deposits</keyword> in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialisation of <keyword id="20751315" type="General" weightage="20" keywordseo="household-savings" source="keywords">household savings</keyword> in the country or the rising preference of Indians towards <keyword id="19929240" type="General" weightage="20" keywordseo="mutual-funds" source="keywords">mutual funds</keyword> and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian <keyword id="19949641" type="General" weightage="20" keywordseo="equity-markets" source="keywords">equity markets</keyword> through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords" meta.keywordsubtype="org" meta.entityname="RBI" meta.hostid="261" meta.entityid="RBI">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by Franklin Templeton, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are household deposits really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. <div type="image" title="Yes, household deposits (as % of total deposits) have dipped, but the drop is far from significant" msid="113663882" hostid="261" sizebytes="306706"></div> Also, we can’t forego the fact that the share of Indian households in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and <keyword id="114757" type="General" weightage="20" keywordseo="savings-account" source="Orion">savings account</keyword> deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (Central Board of Direct Taxes) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of Securities Transaction Tax (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell <keyword id="6361918" type="General" weightage="20" keywordseo="equity-mutual-funds" source="Orion">equity mutual funds</keyword>, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by <keyword id="45369" type="General" weightage="20" keywordseo="equities" source="Orion">equities</keyword> can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in <keyword id="19998084" type="General" weightage="100" keywordseo="deposit-growth" source="keywords">deposit growth</keyword> we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the Fed recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next MPC (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day. Do you have insights or personal experience to share on your personal finances or money? Contact us at <a target="_blank" class="c-link" href="mailto:businessinsider@timesinternet.in">businessinsider@timesinternet.in</a>.

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

India’s appetite is increasing day by and day and the <keyword id="20676228" type="General" weightage="20" keywordseo="food-services-industry" source="keywords">food services industry</keyword> is on a sizzling plate, projected to grow by 10-12% annually for the next seven years, according to a recent study by <keyword id="19896956" type="General" weightage="20" keywordseo="Swiggy" source="keywords" meta.keywordsubtype="org" meta.entityname="Swiggy" meta.hostid="261" meta.entityid="Swiggy">Swiggy</keyword> and <keyword id="19922375" type="General" weightage="20" keywordseo="Bain-Company" source="keywords" meta.keywordsubtype="org" meta.entityname="Bain &amp; Company" meta.hostid="261" meta.entityid="Bain &amp; Company">Bain &amp; Company</keyword>. This translates to a potential customer base of 45 crore people by 2030! <keyword id="20039605" type="General" weightage="20" keywordseo="online-food-delivery" source="keywords">Online food delivery</keyword>, in particular, is expected to grow at an even faster rate with a compound annual growth rate of 18%. Fueled by a growing population, more eating-out occasions, and a wider variety of food options, India's culinary landscape is undergoing a delicious transformation — delicious for the service providers. But what of the consumers? While the study reveals a fascinating diversity in <keyword id="22275323" type="General" weightage="20" keywordseo="how-india-eats" source="Orion">how India eats</keyword>, it also indicates that the top 50, or Tier 1, cities presently account for 70% of food consumption. This wouldn’t be a problem if eating food from outside weren’t basically synonymous with eating unhealthy food. To exacerbate this problem, statistics suggest that this trend will soon seep into the Tier 2 and 3 cities of the country as well. Further, 70% of consumption came from upper-middle to high income households. As per the study, GenZ and other youngsters represent a significant chunk of the food consumption pie – a whopping 40%! <div type="Article" hostid="261" msid="109113406" title="Millennials and Gen Z&amp;#39;s trendy new splurge: groceries" mstype="2" mssubtype="0"></div>Growing up in the age of smartphones and social media, Gen Z is comfortable navigating the digital world to discover new restaurants and cuisines. They're not afraid to experiment, venturing beyond traditional family favorites and trying over three different cuisines and six restaurants in a year! While GenZ appreciates good food, they also prioritise value for money. Online food <keyword id="20039606" type="General" weightage="20" keywordseo="delivery-platforms" source="keywords">delivery platforms</keyword> allow them to compare prices and offerings before placing an order. Furthermore, this generation is expected to dine out more often as their disposable income increases. The rise of online food delivery has revolutionized the way India eats. It has not only extended our eating hours (think late-night cravings!). With changing lifestyles, mid-meal snacking is becoming a popular trend. This opens doors for innovative brunch and evening snack options, requiring restaurants to adapt their opening hours. Delivery platforms have seen an increase in people ordering food items like chicken biryani, fried rice, butter naan, masala dosa and Margherita pizza, among other things, during odd-hours of the day and night. Convenience, taste, and price are now the holy trinity of ordering decisions. Food delivery platforms have intensified competition by making restaurant discovery and comparison a breeze. However, the rise of these food delivery platforms can have a direct impact on the health of Indians, and judicious use of them is advised. <div type="Article" hostid="261" msid="111758782" title="Zomato and Swiggy increase platform fee by 20% – food deliveries to get costlier" mstype="2" mssubtype="0"></div>

Swiggy report says GenZ contributes to 40% of food consumption; highlights recent trend of binge-eating

New Delhi, The per capita monthly household expenditure more than doubled in 2022-23 as compared to 2011-12, according to the latest study of <keyword id="20720109" type="General" weightage="20" keywordseo="national-sample-survey-office" source="keywords">National Sample Survey Office</keyword> (<keyword id="20411472" type="General" weightage="20" keywordseo="nsso" source="keywords">NSSO</keyword>). NSSO, under Ministry of Statistics and Programme Implementation, conducted Household Consumption Expenditure Survey (<keyword id="20462990" type="General" weightage="20" keywordseo="hces" source="keywords">HCES</keyword>) during August 2022 to July 2023, an official statement said on Saturday. The survey aims at generating estimates of household Monthly Per Capita Consumption Expenditure (MPCE) and its distribution separately for the rural and urban sectors of the country, for states and Union Territories, and for different socio-economic groups. As per the survey, the average MPCE at current prices (without imputation) more than doubled to Rs 6,459 in urban areas in 2022-23 from Rs 2,630 in 2011-12. Similarly in rural areas, it jumped to Rs 3,773 from Rs 1,430 at current prices. As per the study, the average MPCE at 2011-12 prices (without imputation) also increased to Rs 3,510 in 2022-23 from Rs 2,630 in 2011-12 in urban areas. Similarly, it rose to Rs 2,008 from Rs 1,430 in rural areas at 2011-12 prices. It showed that the average MPCE also increased (with imputation) to Rs 6,521 in 2022-23 from Rs 2,630 in 2011-12 at current prices in urban areas. Similarly, it rose to Rs 3,860 from Rs 1,430 in rural areas. The average MPCE at 2011-12 prices (with imputation) increased to Rs 3,544 in 2022-23 from Rs 2,630 in 2011-12 in urban areas. It increased to Rs 2,054 from Rs 1,430 in rural areas. The estimates of MPCE are based on the data collected from 2,61,746 households (1,55,014 in rural areas and 1,06,732 in urban areas) in the central sample spread over all states and Union Territories. In HCES:2022-23, the usual practice of imputation of the value figures for consumption out of home-grown/home-produced stock and gifts, loans, free collection and goods received in exchange of goods and services etc. has been continued; and accordingly, estimates of MPCE have been generated. Besides, a provision for collection of information on the quantity of consumption for a number of items, received and consumed by the households free of cost through various social welfare programmes has been made in HCES:2022-23. Consequently, the value figures for food items: rice, wheat/atta, jowar, bajra, maize, <keyword id="20347236" type="General" weightage="20" keywordseo="ragi" source="keywords">ragi</keyword>, barley, small millets, pulses, gram, salt, sugar, edible oil and non-food items: laptop/PC, <keyword id="19986587" type="General" weightage="20" keywordseo="tablet" source="keywords">tablet</keyword>, mobile handset, bicycle, motorcycle/Scooty, clothing (school uniform), footwear (school shoe etc.) received free of cost by the households through these programmes, have been imputed using an appropriate method. Accordingly, another set of estimates of MPCE considering imputed values of these items and of consumption out of home produce, free collection, gifts, loans etc. has also been compiled for HCES: 2022-23.

Monthly household consumer spending more than doubled in last decade

<ul><li>Inflation has been eating into the purchasing power of lower and middle income groups with many essentials’ sales falling.</li><li>Majority of the upper and upper middle class respondents saw their household incomes go up more than inflation.</li><li>There is a dichotomy seen in online festive sales too as premium products are bought with discounts and purchase options say experts. </li></ul>There are two Indias within the great sub-continent. One where the day-breaking drink of tea has become dearer for many this year and the other half is doubling down on wine purchases. Neither of them are affected by the base effect of last year. <keyword id="2653343" type="General" weightage="20" keywordseo="tea-sales" source="Orion">Tea sales</keyword> were down last year too, and <keyword id="806378" type="General" weightage="20" keywordseo="wine-sales" source="Orion">wine sales</keyword> were up — darkening the ‘K’ line on economic recovery charts. Madan Sabnavis, the chief economist of Bank of Baroda calls it a schizophrenic pattern of consumption. “Sales are doing better in categories where price does not matter,” he tells Business Insider India. <div type="image" title="grocery demand" msid="104810160" hostid="261" caption="&amp;lt;p&amp;gt;Source: Pixabay &amp;lt;/p&amp;gt;"></div> It’s discretion not price The categories of goods where price matters are seeing low growth in output – a reflection of demand. Some of the casualties are detergent powders, groundnut oils, shampoos and hair dyes. Their output fell between April to August 2023, compared to the year before, as per BoB economics research. Inflation has a more indirect effect on these purchases. For example, tea and shampoo saw moderate inflation but their demand fell. Inflation was high in coffee, toothpaste and soaps but their demand grew. “The generalized inflation factor has been at work where real income has come down thus leading to lower purchasing power,” said BoB. In a survey conducted by UBS, about 46% of respondents said that they’re buying less personal care and packaged food compared to last year. For purchase of home care products, the respondents were largely neutral versus last year, it added. India’s largest FMCG player Hindustan Unilever with a large presence across rural and urban India has seen a direct impact of it in the quarter that ended in September 2023. Its overall urban volumes grew 3% and rural volumes fell 1%. “Rural recovery is likely to remain gradual,” the company said in its investor presentation indicating that the situation might not see any dramatic recovery in the coming months. Rural India saw reverse migration during the pandemic, but not all of them have gone back, opines Sabnavis. A chunk of downtrading is also being seen in urban areas amongst income groups that are facing the heat of inflation, experts add. At the other end This is, however, only one half of the story. At the other end, many Indians are not blinking while making discretionary purchases. A majority of the upper and middle class respondents – 65% – surveyed by UBS, saw their household incomes go up more than inflation. “The top 20% of the population account for the bulk of discretionary consumption. The survey results support our view that affluent consumers‘ income levels are holding up, as reflected in corporate wage growth that continues at double digits,” said UBS. Lalit Jhawar, co-founder and CEO, LandCraft Retail says that high-end gourmet products in urban areas have been steadily increasing over the last few years. He owns a luxury gourmet retails store- Food Square in Mumbai, which sells cheeses, truffles, caviar, artisanal breads and all the other international food items. “Affluence in urban areas has grown, resulting in a larger number of consumers with higher discretionary income,” Jhawar tells Business Insider India. Online sales: A story of dichotomy Another sign of higher spending is seen in the e-commerce festival sales. The first week of the many festival discount sales saw ₹47,000 crore worth of goods being sold, which is 19% higher than last year, says Redseer Consulting. Online sales, which now sees a good measure of metro and demand from Tier 2 and Tier 3 cities, is showing a dichotomy as well, say experts. “Two Indias have come into play where one India is saving up and waiting for prices to come down to clinch a good deal on premium products. On the other hand, there are low-value product sales i.e value-for-money purchases that are being bought more frequently,” said Abhishek Tandon, engagement manager at Redseer Strategy Consultants. The sale season, which is manna for bargain hunters, is also enthused by the number of Buy Now Pay Later and EMI options. “When it comes to big ticket purchases, premiumization is bolstered by financing options and discounts that make it affordable,” adds Tandon. In the pre-festive period between April and August,however, most consumer durable sales were in a negative zone, due to the high-base effect of last year, says Bank of Baroda’s report. Refrigerators, mobiles, readymade garments all showed a negative output – also indicating that discounts play a large role in discretionary purchases. Indian consumers have always been complicated and price has always played a big role in purchase decisions, choice of brands and more. But it’s no longer a linear story. One end of the market, driven by affluence, is veering towards premium purchases. The other end is looking for ways to survive with less in hand as inflation is eating into their purchasing power. SEE ALSO <a href="https://www.businessinsider.in/stock-market/news/mamaearth-this-fmcg-scion-is-all-set-to-gain-a-windfall-from-honasa-ipo/articleshow/104721052.cms">This FMCG scion is all set to gain a windfall from Honasa Consumer IPO</a> <a href="https://www.businessinsider.in/careers/news/genzs-millennials-wants-to-be-back-to-offices-even-as-costs-pinch/articleshow/104700780.cms">GenZs, millennials want to be back to offices even as costs pinch</a>

Wine vs Tea: India’s consumption trends show a sharp divergence

<ul class="summary-list"><li><a target="_blank" href="https://www.businessinsider.com/everything-you-need-to-know-about-chat-gpt-2023-1">ChatGPT</a> uses more than half a million kilowatt-hours of electricity daily, The New Yorker reported.</li><li>In comparison, the average US household uses just 29 kilowatt-hours. </li></ul>AI is using up a ton of electricity. OpenAI's buzzy chatbot, ChatGPT, is probably using up more than half a million kilowatt-hours of electricity to respond to some 200 million requests a day, according to <a target="_blank" href="https://www.newyorker.com/news/daily-comment/the-obscene-energy-demands-of-ai">The New Yorker</a>.The publication reported that the average US household uses around 29 kilowatt-hours daily. Dividing the amount of electricity that ChatGPT uses per day by the amount used by the average household shows that ChatGPT uses more than 17 thousand times the amount of electricity.That's a lot. And if <a target="_blank" href="https://www.businessinsider.com/generative-ai-future-will-not-be-free-2024-1">generative AI</a> is further adopted, it could drain significantly more.For example, if Google integrated <a target="_blank" href="https://www.businessinsider.com/generative-ai-reliant-on-big-tech-2023-12">generative AI technology</a> into every search, it would drain about 29 billion kilowatt-hours a year, according to calculations made by Alex de Vries, a data scientist for the Dutch National Bank, in a <a target="_blank" href="https://www.cell.com/joule/abstract/S2542-4351(23)00365-3">paper</a> for the sustainable energy journal Joule. That's more electricity than countries like Kenya, Guatemala, and Croatia consume in a year, according to The New Yorker."AI is just very energy intensive," de Vries told <a target="_blank" href="https://www.businessinsider.com/ai-industry-energy-study-small-country-enviroment-2023-10">Business Insider</a>. "Every single of these AI servers can already consume as much power as more than a dozen UK households combined. So the numbers add up really quickly."Still, estimating how much electricity the booming AI industry consumes is tough to pin down. There's considerable variability in how large AI models operate, and Big Tech companies — which have been driving the boom — haven't been exactly forthcoming about their energy use, according to <a target="_blank" href="https://www.theverge.com/24066646/ai-electricity-energy-watts-generative-consumption">The Verge</a>.In his paper, however, de Vries came up with a rough calculation based on numbers put out by Nvidia — which some have dubbed <a target="_blank" href="https://www.businessinsider.com/nvidia-stock-cathie-wood-ark-cisco-ai-internet-bubble-microchips-2024-3">"the Cisco" of the AI boom</a>. According to figures from New Street Research reported by CNBC, the chipmaker has about 95% of the market share for graphics processors.De Vries estimated in the paper that by 2027, the entire AI sector will consume between 85 to 134 terawatt-hours (a billion times a kilowatt-hour) annually. "You're talking about AI electricity consumption potentially being half a percent of global electricity consumption by 2027," de Vries told The Verge. "I think that's a pretty significant number." Some of the world's most high electricity use businesses pale in comparison. Samsung uses close to 23 terawatt-hours, while tech giants like Google use a little more than 12 terawatt-hours, and Microsoft uses a bit more than 10 terawatt-hours to run data centers, networks, and user devices, according to BI's calculations based on a report from <a target="_blank" href="https://consumerenergysolutions.com/what-industries-consume-most-electricity/">Consumer Energy Solutions</a>.OpenAI did not immediately respond to a request for comment from BI.

ChatGPT uses 17,000 times the amount of electricity than the average US household does daily: report

<keyword id="6446946" type="General" weightage="100" keywordseo="Ghee" source="Orion">Ghee</keyword>, a quintessential ingredient in Indian cuisine, is more than just clarified butter; it’s a symbol of tradition, taste, and health. This golden elixir has transcended culinary boundaries, captivating taste buds globally. Known for its rich flavor, aromatic essence, and therapeutic properties, ghee holds a revered position in both kitchens and Ayurveda. <cmsannotation type="cmsannotation" annotationid="What is Ghee?" comment="subhead" text="What is Ghee?">What is Ghee?</cmsannotation> Ghee, derived from simmering butter to remove milk solids, is a concentrated form of butterfat. This process renders it free from lactose and casein, making it suitable for those with lactose intolerance. Its nutty, caramelized taste and high smoke point make it a versatile cooking medium. <cmsannotation type="cmsannotation" annotationid="Nutritional Value:" comment="subhead" text="Nutritional Value:">Nutritional Value:</cmsannotation> Rich in fat-soluble vitamins like A, E, and K, ghee aids in boosting immunity, improving vision, and maintaining healthy skin. Additionally, it contains butyrate, a short-chain fatty acid known for its anti-inflammatory properties and gut health benefits. <cmsannotation type="cmsannotation" annotationid="Health Benefits:" comment="subhead" text="Health Benefits:">Health Benefits:</cmsannotation> The benefits of ghee extend beyond taste. It’s believed to promote digestion, support weight loss, enhance brain function, and nourish the body from within. Its unique composition and fatty acids may assist in reducing inflammation and aiding in nutrient absorption. <cmsannotation type="cmsannotation" annotationid="Indian Household Use:" comment="subhead" text="Indian Household Use:">Indian Household Use:</cmsannotation> In Indian households, ghee is more than a culinary ingredient; it’s a cultural emblem. Used in religious rituals, traditional medicine (Ayurveda), and daily cooking, it adds depth and richness to a plethora of dishes, from aromatic curries to delectable sweets. <cmsannotation type="cmsannotation" annotationid="Culinary Uses:" comment="subhead" text="Culinary Uses:">Culinary Uses:</cmsannotation> Ghee’s versatility shines in various cuisines worldwide. Its high smoke point makes it ideal for sautéing, frying, and baking. Its distinct flavor enhances the taste of dishes, be it drizzled over steamed rice or used as a base for flavorful sauces. <cmsannotation type="cmsannotation" annotationid="Ways to Store Ghee:" comment="subhead" text="Ways to Store Ghee:">Ways to Store Ghee:</cmsannotation> To preserve its freshness, store ghee in an airtight container away from direct sunlight. Its low moisture content allows it to be stored at room temperature for an extended period without spoilage. <cmsannotation type="cmsannotation" annotationid="Precautions and Potential Side Effects:" comment="subhead" text="Precautions and Potential Side Effects:">Precautions and Potential Side Effects:</cmsannotation> While ghee is considered healthy in moderation, excessive consumption may lead to weight gain due to its high calorie and fat content. Individuals with high cholesterol or heart conditions should consume it in moderation. Furthermore, some people may be allergic to milk proteins still present in traces in ghee, so caution is advised for those with severe dairy allergies. <cmsannotation type="cmsannotation" annotationid="Five Frequently Asked Questions:" comment="subhead" text="Five Frequently Asked Questions:">Five Frequently Asked Questions:</cmsannotation> 1. Is ghee suitable for lactose-intolerant individuals? Yes, ghee is lactose-free as the milk solids are removed during the clarification process, making it suitable for lactose-intolerant individuals. 2. Can ghee be used for frying? Absolutely! Ghee's high smoke point makes it an excellent choice for frying and sautéing without burning or emitting harmful compounds. 3. What distinguishes ghee from butter? Ghee is clarified butter where the milk solids and water content have been removed, resulting in a pure, golden-colored fat with a nutty flavor and a higher smoke point than butter. 4. How can one identify good quality ghee? High-quality ghee is golden-yellow in color, has a rich aroma, and a slightly nutty taste. It should be free from any impurities or off smells. 5. Can ghee be consumed by individuals on a weight-loss diet? Moderation is key. While ghee is calorie-dense, its healthy fats may aid in weight loss when consumed in controlled portions as part of a balanced diet. Ghee, an ancient culinary treasure, continues to enchant palates while offering a myriad of health benefits. Its legacy as a sacred, flavorful, and nourishing ingredient persists, transcending borders and centuries. Remember, moderation is essential when incorporating ghee into your diet, allowing you to savor its richness without compromising on health. Note: The article is based on content generated by AI models like Bard and Chatgpt. SEE ALSO: <a href="https://www.businessinsider.in/science/health/food/article/15-delicious-foods-to-help-manage-high-blood-pressure-naturally/articleshow/105408882.cms" data-type="tilCustomLink" target="_blank">15 delicious foods to help manage high blood pressure naturally</a>

Unveiling the golden elixir: The many facets of Ghee

<ul><li>From crackers to clothes to basic household items, lower middle classes have been spending very little in the last few months. </li><li>Most consumer companies are seeing sales and volume growth in their premium products while volumes in value buys are truncating. </li><li>The current festive season which reported bumper sales also saw little participation from the lower middle classes as per RAI. </li></ul>Mahadev Samarth (name changed), a firecracker seller from Meerut enjoyed a bumper sales season this year. Yet he has a lot of inventory left over in bijli crackers or match crackers – which never got sold. Not because they were too expensive, but because the <keyword id="15526256" type="General" weightage="20" keywordseo="lower-income-households" source="Orion">lower income households</keyword> that buy such crackers could no longer afford them. “Most of my pricey range of rockets and more were sold but at the lower end, there are barely any sales,” he told Business Insider India. The lower middle classes also seem to have held off their festival celebrations and that’s evident in sales of other goods as well, be it clothes or household items. “Retailers were indicating that items at higher price points were witnessing better sales than discretionary items at lower price points in the month of August, which was also a non-occasion month. This may indicate that the <keyword id="2725447" type="General" weightage="20" keywordseo="lower-middle-class" source="Orion">lower middle class</keyword> may have put a temporary pause on shopping due to inflation,” said a report by Retailers Association of India (RAI) at the end of September. The October sales in general have been robust, as <a href="https://www.businessinsider.in/business/news/retail-sales-jump-19-from-pre-pandemic-levels-west-india-leads-recoveryrai-survey/articleshow/95502977.cms">per RAI’s latest report</a>. The lower middle classes have been becoming tight fisted for a long time now, and even the upbeat festival mood has not changed that. In fact, lagging growth in rural areas (where half of India’s lower middle class resides) and its slow recovery is affecting many large companies in their value buy segment. Price cuts are not helping There is another indicator to tell us the spending habits of India’s vast lower middle class – hawai chappals or the humble flip flops. With prices starting from around ₹100, they are the most value-buy purchases in the footwear segment known for their comfort and longevity. The segment has seen a degrowth of 20% in the last six months in terms of value, as per Relaxo Footwear’s Q2 earning commentary. “So in the shoe division, our growth in the last six months is around 30%. So there is a healthy growth coming in the shoe division, which is sports shoes and sports sandals. So that has grown well, but open footwear, which is Hawaii, has degrown,” said Gaurva Dua, executive director of Relaxo, who also said that they are facing pricing pressures in the segment. At the same time, their sports shoes and out-of-home footwear segments performed well – indicating the dichotomy in spending patterns as seen in the case of cracker sales. Marico too says it has seen its business growing at one end and truncating at the other. And, reducing prices is not helping, indicating either heavy reduction in consumption or downtrading to local or unbranded products. Its popular hair oil brand’s Parachute’s volumes reduced 3% and revenue by 11% in the second quarter. Its price reduced by 8% and the company has rolled out further cuts in Q3, says an Axis Capital report. On the other hand, its premium personal care segment posted a strong 40% year on year increase. The heat of inflation The consumption story which had started to show an uptrend post-lockdowns has been exhibiting an uneven growth. This is especially true after consumer price inflation hit an eight-year high of 7.79% in April this year. Ever since it remained above 7% every month, easing only temporarily to 6.7% in July, until it reached <a href="https://www.businessinsider.in/finance/news/retail-inflation-eases-to-6-7-in-october-from-7-4-in-september/articleshow/95512476.cms">similar levels in October</a>. Even as retail inflation eased to a three-month low in October, <keyword id="67286" type="General" weightage="20" keywordseo="food-inflation" source="Orion">food inflation</keyword> remained at around 7%, with essentials like meat, cereal, milk and vegetables eating into the household budgets of the lower middle classes. And this softened consumption story is showing little signs of recovery if the earnings commentary of consumer product and FMCG companies are to be believed. Dabur too has taken a hit in the second quarter, as around 46% of its revenues come from the value segment, targeted to rural markets. This time, however, its urban growth lagged too, for the first time in six quarters. Unlike Marico which believes that its overall volumes will grow at mid-single digits volume growth in the second half of the year, Dabur expects only a marginal growth. “Dabur’s 2Q rural demand (as tepid with 1% y-y growth) and lagged urban (6% y-o-y growth) for the first time in six quarters, with downtrading to smaller packs visible owing to inflationary pressures. Management expects near-term pressure on volumes to continue, but to be marginally better q-q,” said a report by Nomura. The Indian middle class accounts for around 28% of India’s total population – at 1.3 billion. Of this, the lower middle class makes up for around 14%, as <a href="https://www.livemint.com/news/india/the-anatomy-of-india-s-middle-class-1556088919798.html">per a Mint report</a>. Apart from making up a distinct consumption class, this aspirational segment and its growth momentum is key to <a href="https://m.economictimes.com/news/economy/indicators/middle-60-india-can-help-gdp-growth-to-10-study/articleshow/54725412.cms">the nation’s GDP growth</a>. However, they are also the most vulnerable. In times of most crises, be it inflation or economic slowdown, the lower classes are the first to be affected and the last to recover – a factor that’s now taking a toll on companies and retailers who build their business models around them. (With inputs from Sudhanshu Singh) SEE ALSO <a href="https://www.businessinsider.in/business/corporates/article/tatas-mega-aviation-merger-is-poised-for-flight-but-the-skies-are-not-clear-yet/articleshow/95526116.cms">Tata's mega aviation merger is poised for flight, but the skies are not clear yet</a> <a href="https://www.businessinsider.in/business/corporates/article/nykaas-fashion-foray-and-pipeline-style-biz-model-worries-analysts/articleshow/95405203.cms">Nykaa’s fashion foray and pipeline-style biz model worries analysts</a>

Inflation burns a hole in the pockets of India’s lower income households. From FMCG goods, flip flops to crackers, consumption takes a backseat

<ul class="summary-list"><li>The US economy doesn't have any dry powder left as inflation has eaten through household savings.</li><li>Cash savings as a percentage of total consumption have returned to 2019 levels for most Americans.</li></ul>The dry powder of cash savings that was expected to cushion the economy has run out, as inflation has practically wiped out US households' excess savings, according to an analysis from Bespoke.Consumers built up "huge cash balances" during the pandemic, partly due to a pullback in spending as well as government-issued stimulus checks. That cash was thought to be a buffer to the slowing US economy, giving consumers some leeway to keep spending despite tightening financial conditions.But those expectations are actually misplaced, the investment firm said in a note, as inflation has eaten away the spending power of household savings for most Americans.Though households nominally have a higher amount of savings than they did before the pandemic, that picture changes when looking at cash savings as a percentage of total consumption, which factors in the added pressure on consumers from rising prices. When counting money market and deposit assets as a percentage of total consumption, most Americans have the same amount of savings they did in 2019.<h3>Money Market + Deposit Assets, % of Total Consumption, Change From 2019 Average (%)</h3><div type="image" title="Household savings taken as a percentage of consumption" height="389" width="934" msid="106525028" hostid="261" sizebytes="24378"></div>"For all but the highest earning and most wealthy households … cash holdings relative to consumption are basically back to where they were in 2019. In other words, there is no dry powder of cash left to fund consumption growth," the firm said. "That's especially true given the fact that the highest and wealthiest consumers are not cash-constrained for consumption in the first place."Consumers have been flashing other signs that their financial health is starting to deteriorate. Credit card debt hit a fresh all-time high last year. Meanwhile, student loan payments have restarted after a three-year hiatus, meaning <a href="https://www.businessinsider.com/paying-bills-credit-card-debt-student-loans-2023-8">it'll be difficult for many to pay keep paying bills</a> while maintaining a robust pace of spending.A slower pace of spending could spell trouble for the US economy, which still faces a decent risk of recession in 2024. A <a href="https://www.businessinsider.com/economy-consumer-spending-credit-card-debt-delinquencies-retail-hiring-2023-11">pullback in spending could result in a consumer-led slowdown</a>, Macquarie strategists said in a November note.

The economy has run out of dry powder as inflation has slashed excess household savings, investment firm says

<ul class="summary-list"><li>Savings built up by American households during the pandemic are all but gone, the San Francisco Fed says. </li><li>US household savings have fallen from a record $2.1 trillion in 2021 to around $190 billion as of June, per their data.</li></ul>US households are poised to run out of the excess savings accumulated since the pandemic by as early as the end of September, the San Francisco Fed has warned.Excess household savings in the US have fallen every month for the past 23 months and are poised to run dry in the third quarter, <a href="https://www.frbsf.org/our-district/about/sf-fed-blog/excess-no-more-dwindling-pandemic-savings/" target="_blank" rel="noopener">according to their research</a>. In 2021, Americans had amassed a record $2.1 trillion in excess savings, spurred by government stimulus checks and a drop in in-person spending. But that had fallen to just $190 billion by June, San Francisco Fed research suggested, and is projected to be falling at a rate of $100 billion per month."Our updated estimates suggest that households held less than $190 billion of aggregate excess savings by June. There is considerable uncertainty in the outlook, but we estimate that these excess savings are likely to be depleted during the third quarter of 2023," San Francisco Fed analysts said in a recent blog.As of July 2023, the US personal savings rate stood at <a href="https://fred.stlouisfed.org/series/PSAVERT" target="_blank" rel="noopener">3.5%</a> – below pre-pandemic averages.This measures the percentage of individuals' incomes remaining after paying taxes and spending money on consumption. A drying-up of savings could have wide-ranging effects on the economy, and some analysts believe it would hurt consumer spending, as extra cash runs out and student loan payments restart in October."Our estimate of excess savings for US households when adjusting for inflation is now fully exhausted from a 2021 high of $2.1 trillion, with risk of widening imbalance if outlays accelerate," JPMorgan analyst Marko Kolanovic <a href="https://markets.businessinsider.com/news/stocks/stock-market-outlook-consumers-spend-down-excess-pandemic-savings-2023-8">said last month</a>. Americans' cash pile has previously kept consumer spending afloat ever since COVID-19 restrictions were relaxed, supporting the economy even as the Federal Reserve raised interest rates steeply since last spring. But historically high inflation since mid-2021 has eaten into the savings, as prices of everything from energy to food surged. Inflation hit a 40-year high of 9.1% in mid-2022, but has since slowed to 3% as of last month, in part tamed by the Fed's aggressive rate hikes.

You Searched For "household consumption" and got 11 results

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A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

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Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

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Swiggy report says GenZ contributes to 40% of food consumption; highlights recent trend of binge-eating

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Monthly household consumer spending more than doubled in last decade

PTI

Wine vs Tea: India’s consumption trends show a sharp divergence

Katya Naidu

ChatGPT uses 17,000 times the amount of electricity than the average US household does daily: report

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Unveiling the golden elixir: The many facets of Ghee

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Shagun

Inflation burns a hole in the pockets of India’s lower income households. From FMCG goods, flip flops to crackers, consumption takes a backseat

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The economy has run out of dry powder as inflation has slashed excess household savings, investment firm says

Jennifer Sor

US households are on the brink with excess savings likely to be depleted by month-end, San Francisco Fed says

Joseph Wilkins

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