How 5,10 paise coins help Mysuru tea vendor track his debtors…

Interesting story in Bangalore ToI today. The article shows how a tea vendor in Mysore keeps track of his debtors using 5/10 paisa coins.

Another case whch shows poor are not as stupid as we make it out to be. They design their systems using indigenous ways that are simple yet useful. In particular the systems of accounting and credit management are really worth looking at.

So what is the story here?

We have done away with 5, 10, 20, 25 paise coins, but they can be found in large numbers at a tea stall on Chamaraja Double Road. Shop owner Shivanna, 62, cannot go about his business without them. He uses them to keep track of how much his customers owe him.

As shops, vendors and commercial establishments form a major section of his customers, they often pay Shivanna only at the end of the day or at the end of the week after buying on credit the whole time. Shivanna feels keeping an accounts book is time consuming, so he evolved his own style of abacus, where one paise stands for one rupee.

His system is simple: One pile of coin stands for a particular customer and he keeps on adding coins as the customer buys tea/coffee or snacks on credit. As a result, his stall is dotted with several small pile-ups. The only, or the biggest, challenge is to remember which pile stands for which customer.

However, that’s something easy for Shivanna. Though, the stall serves around 50-600 customers a day, not all buy on credit.

Explaining his method and his experience, Shivanna said, “When I started this business more than 30 years ago, I used this method to avoid writing balance amounts in account books to save time. Unknowingly, I slowly started remembering the balance and credits of customers just by looking at the coins.”

Hmm.. Those who would have visited the stall and saw all those jars full of 5/10 paise coins would have wondered what is going on.

Actually, it is really interesting to see these guys operate. They have multiple sources of managing the cash/credit system. We often notice that these small vendors have multiple pockets and keep moving money through them. This is part of their mental accounting where each pocket is meant for some particular transaction. In some cases the upper shirt pocket could be meant for small transactions and so it has loose change. The pockets in trousers/table drawers are meant for larger  transactions. It could be vice-versa for others. There is a whole accounting system mapped out which is quite sophisticated in its own way..


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