You are here: Home » Economy & Policy » News
Business Standard

Govt tables bill to streamline chit fund sector, hike foremen's commission

According to the Bill, concerns have been expressed by various stakeholders regarding challenges being faced by the chit business

Chit Fund Bill

Press Trust of India  |  New Delhi 


A Bill to streamline and strengthen the chit fund sector was introduced in the Lok Sabha on Monday which mandates video conferencing while the opening of bids and seeks to hike commission of foremen from 5 per cent to 7 per cent.

The Chit Funds (Amendment) Bill, 2018 is based on the recommendations of the Parliamentary Standing Committee on Finance and the Advisory Groups on Chit Funds set up by the central government.

The Amendment Bill provides for allowing the mandatory presence of two subscribers, as required either in person or through video conferencing duly recorded by the foreman, while the bids are being opened.

It also provides for increasing of ceiling of foreman's commission from five per cent to seven per cent.

According to the Bill, concerns have been expressed by various stakeholders regarding challenges being faced by the chit business.

The central government had constituted a key Advisory Group on chit funds to review the legal, regulatory and institutional framework for the sector and its efficacy and to suggest initiatives required for its orderly growth.

The Chit Funds Act, 1982 was enacted to provide for the regulation of chit funds which are indigenous business in India and have conventionally satisfied the financial needs of low income households.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Mon, March 12 2018. 21:04 IST