Understanding Chits and eChits

Understanding Chits and eChits

Chits have been an Indian concept where a section of people come together and pool money for a common purpose that benefits everyone. If you have a closer look at chits as a concept it is based on mutual trust with the registered chit fund companies in India, confidence and working to a schedule of the chit scheme. Since its origin, chits have been serving the needs of millions of people across the globe.

Let’s take a super quick view of chit funds work: A few people say 5 of them would come together to pool 100 rupees from each of them. The first-month pool would be 500 rupees. This is called prize money. The names of all 5 members are written on a small piece of paper called a chit. One chit would be drawn and he would get all the fund (prize money). This process continues for the agreed time until everyone would get their prize money. This is a win-win situation for everyone. It’s a simple but powerful way of pooling money for a cause. It’s a kind of credit and saving at the same time.

At IBG eChits, we leverage the power of technology to the proven methodology of chits to give it a new name called eChits. This enables us to build a virtual community of people willing to pool money for a chit scheme. We use the credit risk tools to make sure the people along with you in a chit scheme pay on time. The last person to take the money gets more money than the person who takes it in the first month. The prize money for a chit scheme is done through a virtual auction from your mobile app. So with the advancement of technology, at IBG eChits, you can borrow cheaper, save faster and invest better.

For more information, please write to us at info@ibgechits.com

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