Twenty-five people agree to save the same amount every month for twenty-five months. Each month the pooled amount is auctioned, and one member takes it home.
If you need money early, you bid for it and pay a discount for the privilege. If you don't need it yet, you keep saving — and you collect a share of every discount that other members offer along the way.
By the end of the cycle, every member has received the chit once. Early takers got funds when they needed them. Late takers earned a return of up to 15% on their savings. Nobody is left out.
Worked example used throughout this page
Every month, all 25 members contribute ₹20,000 each. The pool comes to ₹5,00,000 — the full chit amount.
The pool is auctioned on a fixed day at a fixed time, in front of every member. The bidder offering the highest discount wins.
The foreman takes 5% commission. What remains of the discount is divided equally among all 25 members as dividend.
The winner receives the prize money — chit amount minus the discount they offered — once surety is completed.
A ₹5,00,000 chit auctioned at the maximum 30% discount. Here is the full breakdown, month by month.
25 members × ₹20,000 = ₹5,00,000. This is the chit amount available for auction this month.
The highest bidder offers a 30% discount, which is the maximum permitted. If more than one member bids the full 30%, the winner is chosen by an open lottery method in front of all members.
The company's commission is 5% of the chit amount — ₹25,000 on a ₹5,00,000 chit. This is the only charge. Nothing else is deducted.
₹1,50,000 discount − ₹25,000 commission = ₹1,25,000, divided by 25 members = ₹5,000 per person. That amount is deducted from next month's subscription, so you pay less.
₹5,00,000 chit amount − ₹1,50,000 discount = ₹3,50,000, released as soon as surety and securities are completed.
Both members come out ahead — they just come out ahead in different ways.
You need money now — a medical bill, a wedding date, a business opportunity. You bid, you win, and you get funds without a loan application, without collateral valuation, and without a credit score.
You don't need the money yet, so you keep saving. Every discount another member offers puts money back in your pocket, and your monthly subscription keeps falling.
The chit amount is disbursed immediately once the surety and securities are paid and the documentation is complete.
Only members who have paid their full instalment amount are permitted to participate in that month's auction for taking the chit.
The management holds full authority to accept or reject a surety offered by a member. The company's decision will be final.
Visit any branch and we will walk you through a live auction schedule, the documentation, and exactly what your monthly outgo will look like.
