What you should know about chits

A chit fund is a savings scheme in which a group of members pay a fixed amount every month. Each month the pooled amount goes to one member through an auction. Everyone keeps paying until the scheme ends, so every member receives the chit amount once.

Members who need money bid by offering a discount on the chit amount. The member who offers the highest discount takes the chit that month. After the foreman’s commission, the discount is shared among all members as a dividend.

You build a habit of saving a fixed amount every month. You can take a lump sum before the scheme ends, when you need it most. Dividends from each auction lower your monthly payment, and there are plans for every budget, from ₹1,500 a month.

RANM Chit Funds is registered under the Chit Funds Act, 1982, and has served families in Erode and Gobi since 1962. As the Act requires, every chit group is registered with the Registrar of Chits before it starts, and every auction is recorded in writing.

The instalment is the chit value divided by the number of months. For example, a ₹3,00,000 chit over 30 months is ₹10,000 a month. Auction dividends usually bring your actual payment below this. Try the calculator on the Schemes page.

You can bid in any monthly auction once you have joined. If you don’t need the money early, you can wait. Members who take the chit later usually receive a larger amount.

Please contact your branch straight away. A late payment may attract a penalty under the chit agreement, and members with unpaid instalments may not be able to bid until they catch up.

Payments can’t normally be withdrawn before the scheme ends. In some cases your membership can be transferred to another person with the company’s approval. Talk to your branch about your situation.

No. You can join online and pay online from anywhere in India. Auction dates and results come to you on WhatsApp from our automated chatbot.

Fill in the online application. It downloads a pre-filled form in the official format. Sign it and bring it, with your Aadhaar and PAN, to any branch. You can also walk into a branch and join there.

Pay online by UPI, debit or credit card, or net banking, or pay at any of our branches.

It is the central law that governs chit funds in India. It sets the rules for registering chits, running auctions, the foreman’s commission and the rights of members. See our summary on the Chit Funds Act page.

The foreman is the company that runs the chit, here RANM Chit Funds. The foreman collects instalments, conducts the auctions and pays out the chit amount, in return for a commission set within the limits of the Act.

Check that the company is registered and has a long, open track record. Read the terms: the duration, the commission and how payouts work. Choose a plan whose monthly instalment fits comfortably in your budget.