"The chit operators or the foreman takes the initiate as to starting a chit group. The foreman based on these surveys of potential subscribers or based on his own decision determines the amount of the chit, the time period of such chit, the number of members, the number of installments and the amount payable on each instalment.
Once the foreman has decided on the chit group he has to go ahead with the procedural formalities as follows."
The foreman has to create a fixed deposit with a scheduled bank upto 100% of the chit value as per the Chit Fund (Karnataka) Rules 1983. This fixed deposit is accountable to the foreman. The period of the fixed deposit has to be the same as that of the chit group or anything exceeding that.
The foreman after obtaining the fixed deposit has to now make an application for prior sanction. This application is to be made to the registrar or the officer incharge of chit funds in that particular state. The application should also have the original copy of the fixed deposit. The registrar after receiving such application and deposit certificate would issue the prior sanction certificate.
The foreman is allowed to communicate or advertise about the new chit group only after obtaining the prior sanction certificate. The foreman now invites application from prospective subscribers. The application is in the form of chit agreement, which is filled in triplicate by the subscribers and duly signed and attested. The foreman has to now sort all these application in order.
The foreman after collecting all application from the subscribers and deciding on the number of subscribers for the chit group has to make an application to registrar for the certificate of commencement. The application should accompany all the applications received by the foreman from the subscribers. The registrar on proper scrutiny of the application and collection of the charges would issue the certificate of commencement and also attest the applications received.
The foreman has to now communicate to all his registered subscribers the receipt of the certificate of commencement and he has to send the chit agreement duly attested and signed by the foreman himself and the registrar. The foreman also collects the first installment of the chit.
The date and time of auction is decided and communicated to all the subscribers. All the subscribers interested in drawing the chit amount make themselves present at the auction. There should be a minimum of 2 subscribers present at the auction as per the Chits Funds Act 1982.
The chit auction is conducted in the presence of all the subscribers and the foreman himself. The auction begins on the order of the foreman. The bid for the auction has to start from 5% of the chit amount which can go up to a maximum of 30% of the chit amount. The subscribers who are in immediate need of funds make to higher bid. The subscriber making the highest bid to forego the maximum percentage is declared as the Prized subscriber in the presence of all the other subscribers. In case there are more than two subscribers who are willing to forego the maximum of 30%, the prized subscriber is decided by a lucky draw.
The foreman is liable to pay the amount in full to the subscriber as per the bid. The payment has to be made within a maximum of 30 days from the date of such auction or before the next draw.
The amount foregone by the prized subscriber is the Surplus for the chit group. This surplus is to be distributed equally among all the subscribers also known as Dividend. This surplus can be distributed either in cash or can be adjusted towards the next installment of such chit.
The minutes of the chit along with all the details of the prized subscriber, the amount foregone by him etc., are to be communicated to the Registrar of Chits. This report has to be submitted to the Registrar within a maximum of twenty one days from the date of such auction.
The cycle continues by the Foreman collecting the next installment from the subscriber and making the next auction.
Normally I do not prefer chits as an option for investment. However when I heard that LOTUSIND
Chits is a registered chit fund company I decided to invest with them . The joining process and
the documentation were very smooth and the process was explained efficiently. The staff of LOTUSIND
chits are very professional and the statements and updates are sent regularly through email & SMS.
" Whenever I have approached LOTUSIND , I have never been disappointed. Whenever I needed financial
help and I needed to execute the biggest of the orders I was able to do it because of chit fund schemes
at LOTUSIND .If we keep on collecting small amount of money with the company, in the end we have a
huge capital in hand, which can be used for personal purposes or business purposes. "
" I am grateful to LOTUSIND Chit Fund that I have been able to increase my business to this level.
All the transactions are legal and cheque driven. I hope that with the help
of LOTUSIND all the manufacturers are able to double their business. "
" I wanted to save some money, so I decided to invest with LOTUSIND Chits Pvt.Ltd.
I really liked their wide range of chit
groups which matches to the need of people from different walks of life and the other confidence factor
is that it is a registered chit fund company. I had some medical
emergency for which I had to bid my chit and the amount was given to me on the promised time and
process was hassle free. "
LotusInd Chits Pvt. Ltd is the registered chit funds co., in the State of Karnataka, registered under the Chit Funds Act 1982. The company being registered under the Companies Act 1956, began its operations in November 2015. We are licensed chit operators coming under the preview of Chit Fund Act, RBI and Registrars of Company The company has a member profile of more than 100-150 registered Business/Working class customers and 50 employed customers participating actively in its chit programmes / schemes. Read More
Corporate Office : # 122 / 15 / A , 1St Floor Kalburgi - Noolvi Avenue New Cotton Market , Deshpande Nagar HUBBALLI - 580029. KARNATAKA
: 0836 - 4260414
Registration No : U6599KA2015PTC084831