It is said that over a thousand festive occasions are celebrated throughout the year in our country. Every festival in India is greeted with big celebrations and sometimes a unison of cultures. Festivals are the basic paradigm of the people living in India and are fully charged by culture and collectivism. Many festive occasions are performed from a religious vision in memory of saints, gurus, gods, and goddesses and the triumph of good over evil. Currently, there are 51 festivals recognised across India out of which 17 are National level festivals and 34 are State level festivals.

Indians do not shy away from spending during festive events or any kind of traditional celebrations. In India, people spend on home decor, tasty meals, apparel, accessories, gifts, etc.

Recent statistics indicate a difference in expenditure between rural and urban areas. Currently, India has a population of 1.45 billion people; among them, 63.4% are rural folks and 36.6% are urban dwellers. This larger rural population considerably influences the total costs of festivals. But does this go beyond the numbers? Let’s explore further.

Is Urbanisation Shaping Modern Beliefs?

The process of urbanisation has played a significant role in shaping modern beliefs and values, affecting everything from daily life organisation to perspectives on tradition and religion. The transition from a rural way of life to an urban one is fast and results in exposure to multicultural environments, improved academic opportunities, and better economic prospects, all of which will create more liberal and unique mindsets.

Financial Literacy and Inclusion 

People talk about SIPs, mutual funds, LIC, and savings accounts in urban homes where the knowledge of money management is transmitted through a family’s generations. Pervasive availing has remained poor compared to the current economy’s standard, especially in the rural areas as a result of issues in Rural Education. Education provisions for underprivileged children of rural India have somewhat improved in the last decade, but certain hurdles remain that impede satisfactory all-round child development, including basic finance management.

Rural schools sometimes face a scarcity of resources including textbooks and computers for students which limits the overall development of the students. There is also scarcity of qualified teachers particularly in essential learning areas such as mathematics and science, which help students grasp basic financial literacy thus crippling their chance at individual and financial freedom. Such compounded challenges in rural education limit financial education, thus denying students adequate ability to make efficient economic decisions in their lifetimes.

Living in an urban area means that we have access to ATMs at every corner, in every mall and market. There are also well-established banks and banking representatives available nearby. But is the situation the same in rural areas?

Through a World Bank-NCAER survey conducted on access to finance in rural areas, the results show that 70% of the rural poor have no access to a bank account while 87% cannot access credit through banks. Some of these constraints are the lack of easy and/or flexible banking services and products tailored to the rural demand. Also, this hampers the use of formal financial institutions since such transactions involve relatively high transaction costs such as complicated and costly procedures, long turnaround time, and sometimes even outright bribery.

However, for most rural borrowers, the provision of collateral presents another challenge that leaves them locked out of basic financial services and exacerbates the rural-urban split in financial access. This explains why people in rural areas have a propensity to become influenced and spend extravagantly, and they like to keep their wealth.

A Reflection of Homebound Finances and Lifestyle Choices

Compared to urban day-to-day standard of living in urban areas, the adopted rural household consumption costs way less because it includes a home–firm where the various basic products such as vegetables, grains, milk, and poultry are produced on the farm hence purchased little from the market subsequently cutting down on food expenses in the household. Expanding fuels like wood and bore rainwater also helps to reduce many utility bills, any excess produce may also be sold locally and the money can be saved or reinvested. This self-sufficiency reduces fluctuating costs of staple foods making expenses for rural families more predictable. Also, they get to meet some needs without money through community barter and sharing systems which means more savings.

Rural India’s Festive Spending: Tradition, Harvest, and Community Pride

Festivals are the most vital periods consumer companies examine since, unlike urban families with lower total household income, rural households may spend even more during the festive season for several reasons— Most festive celebrations observed in rural areas occur at the end of harvest seasons and this gives families some amount of money they can use to fund festivities.

Festivals are considered to be prestigious and this is why people invest in them as a form of thanks, status, and worship even if they have to spend their hard-earned money, take money out of the savings of a family, or credit a festival or a festal. While the population of the cities consumes entertainment and dining services all year round, the major expenditure of the rural families is associated only with the celebration of festive events.

These celebrations often involve many people coming together at large meetings and big meals, they engage the resources of the people and the villages, as well as public decorations which act as a plus to the already big celebrations of rural festivals. Many occasions are marked by an expectation to display family pride in new clothes, new home decor, and copious meals thereby making festivals a large feature in annual rural budgets.

Government rules and regulations on festive occasions 

In most festival organisations, the requirements set by rural areas are not as strict as those of urban areas. In rural areas especially there are no laws limiting the number of people that can assemble, loud music, pollution, and uses of decorations. On the other hand, local governments in the urban area came up with several conditions and measures against many people and celebrations. These include limitations on gatherings, curfews, regulations on noise and air pollution, and stricter security measures for significant events. Policies on traffic movements, fire, and decorum may also limit urban festivals, such that they cannot host major events without permits and regulations.

On the other hand, rural areas with low population density, good-town planning, and communities being comparatively compact, involve less interference or restrictions and can hold a procession, outdoor activities, celebrations, etc. without much procedural formalities. This means that rural configurations enable community cooperation to avoid the need for restrictive and expensive counterparts to spend more on large public decorations celebrations, and religious ceremonies. The flexibility also allows more organised and communal events, which helped the observers notice that people from rural areas spend more money during a festive occasion than their urban counterparts, even though rural celebrations often appear to be consistently more informal, with less extravagance and formalised displays of merriment than in urban areas.

The comparative study of festive spending in rural and urban households in India is an area of interest. While urban families are commonly straitened because of high prices combined with limitations on celebrations set by the authorities, members of the rural families manage to use their agricultural products and relations with neighbours and acquaintances to fund bright festivities. The fact that these celebrations are culturally relevant makes rural people budget on festivals as these are considered very socially essential and part of a status symbol. Also, government policies regarding celebrations do not put much pressure on rural people due to fewer restrictions which make room for extra celebrations with great public involvement.

Since the traditional festive occasions remain an essential part of simple rural people’s everyday lives, such peculiarities in financial behaviour as key factors that define the relationship between tradition, finance, and societal aspects of the chosen subject to do deeper research in the economics of rural area in the multicultural context of India. Lastly, understanding these dissimilarities in spending patterns can assist companies and policy addressees to concentrate on the expenditures and implement policies that would befit those citizens in the countryside and cities nurturing the overall growth of the nation’s economy.