What is a Chit Fund?
A chit fund is a savings-and-borrowing scheme in which a group of people agree to contribute a fixed amount periodically for a specific period. The pooled amount (the chit value) is distributed to members in turns, decided by lots or an auction.
One pool, everyone benefits
- Peer group — subscribers contribute a fixed amount periodically into a common pool.
- Auction — each cycle, the member who bids the lowest wins the prized amount.
- Dividend — the discount is shared among all subscribers after deducting the organiser’s fee.
- Everyone gets a turn — over the scheme’s duration, every member receives the pool once.
Chit funds are classified as Miscellaneous Non-Banking Financial Institutions, and a chit fund company is one that operates, conducts or manages chit schemes.
Benefits of Chit Funds
Save regularly, borrow easily — and keep full control over how you use the money.
Save & Borrow in One
Deposits made by all subscribers become a lump sum — you get the advantage of saving as well as borrowing.
Builds a Saving Habit
Inculcates the habit of setting apart an amount every month towards investment for a rainy day.
Quick Access to Money
Easy to join, and you can borrow the pot by just paying the first installment.
No Questions Asked
Use it for marriage, travel, medical expenses, festivals, education, business — you never need to reveal the purpose.
Your Contingency Fund
Easily access money to meet unexpected expenses, financial emergencies or personal needs.
High Dividend
Subscribers earn a dividend comparatively higher than interest accrued on typical deposit schemes.
Low Interest
Interest is mutually determined by subscribers at auction — lower than moneylenders and most other borrowing.
Lowest Intermediation Cost
Intermediation cost is the lowest in the market, with exit options at nominal charges.
No Periodic Interest Hikes
What the group decides is what you pay — no surprise rate revisions along the way.
What The Chit Funds Act, 1982 guarantees you
When a chit is registered, these protections are the law — not a promise.
Source: The Chit Funds Act, 1982 (Act No. 40 of 1982) · Read the Act on India Code
Registered vs Non-Registered Chit Funds
To secure their investment, subscribers are always advised to go with Registered Chit Fund Companies.
✅ Registered Chit Fund
The State Government appoints the Registrar of Chits, who regulates chit funds under The Chit Funds Act, 1982 and the rules framed under it.
- Compliance-driven approach — secure
- Monitored by authority
- Security deposits with the Registrar
⚠️ Non-Registered Chit Fund
Unregistered chit funds are saving schemes operated informally among friends, family or colleagues.
- Unorganised structure — less secure
- No governing body
- No security deposits
- Banned by the Government
RMC is a Registered Chit Fund Company
Reg. No: 2827 · CIN: U67100DL2019PTC35036 · Regd. under The Chit Fund Act, 1982 & Delhi Chit Fund Rules, 2007.
Join a Chit Plan