FAQs
Valathi’s
Frequently Asked Questions(FAQs)
What is a Chit Fund?
A chit fund is a type of savings scheme where a group of individuals contribute a fixed amount regularly, and one member receives the pooled amount through a bidding or lucky draw every month.
How Does a Chit Fund Work?
Members pay money monthly as their subscription amount, and one member receives the amount through auction, while others continue contributing.
Are Chit Funds Legal in India?
Yes, chit funds are legal and regulated under the Chit Funds Act, 1982 by state governments.
How does Valathi Chit Funds operate?
Valathi and it’s subsidiaries are registered and operates under the Chit Funds Act, 1982. We organize chit groups, collect monthly subscriptions, and conduct fair auctions to determine who receives the fund each month.
Who can join Valathi’s chit groups?
Anyone who is 18+ years old and can provide valid ID/address proof can join. A stable source of income and a guarantor may be required for some schemes.
What are the benefits of joining a chit fund?
Doubles as savings + credit
Low documentation compared to bank loans
Flexible and community-driven
Ideal for meeting personal or business financial goals like buying house / plot, buying gold, clearing personal depts, children’s educational expenses, medical expenses, buying vehicle etc.
How is the winning bidder decided each month?
The chit amount is usually auctioned. Members can bid for a lower amount, and the member who agrees to take the lowest amount wins. The foregone amount is shared among members as a dividend.
What happens if I don’t win early?
AYou’ll still receive the full chit amount in one of the later months (usually through a lucky draw if no one bids). Every member is guaranteed a turn.
What is the commission or foreman’s charge?
The foreman’s commission is a small percentage (as per chit fund rules) and is disclosed upfront. It is deducted from the gross chit value.
What if a member defaults on payment?
We have strict follow-up and recovery procedures. Security details or guarantors are collected during enrollment. The rest of the group is protected from such risks.
Can I pre-close my chit?
Yes, in some schemes. Terms for pre-closure vary based on how far the chit has progressed. Any pre-closure must be approved by the management.
How do I join or inquire further?
You can visit our office, contact us at 94439 86143, or fill out the online enquiry form. We’ll guide you through the process and help you choose a plan that suits your needs.