Cannot login when /etc is not readable. V4.3.2 (build 1201)

When i am not logging into a root user. Say someone like testuser and i set /etc to 750 i get the error below. If i use putty i can log in but winscp will not work.

I have /etc to be 750 bc some passwords are in config files and i rather not allow ppl to read them. AFAIK theres no reason to allow o to r-x there.

Cannot login when /etc is not readable. V4.3.2 (build 1201)

I get exit status 141
Cannot initialize SFTP protocol. Is the host running a SFTP server?

Nevermind. Someone talked me out of setting /etc to 750. so i guess you can ignore this. It turns out my webserver distro didnt use bash as its default shell in nonroot users. So when i fixed that i realize it needs bash and thats probably related to the problem winscp has.