Chit funds are one of the most trusted and time-tested financial tools in India. They offer a unique mix of saving and borrowing, providing flexibility to individuals and small businesses alike. At KDC Chits, we aim to simplify this traditional system by offering legal, transparent, and user-friendly chit schemes for everyone.
How Many Types of Chit Funds Are There? This is a common question for anyone exploring chit schemes. Let’s take a closer look at the major types of chit funds and how they work.
1. Auction-Based Chit Funds
This is the most popular model in India. Members contribute a fixed amount monthly. In each cycle, a member wins the pooled amount through a bidding (auction) process by accepting a discounted value. The discount is then distributed among the remaining members as a dividend. KDC Chits operates several trusted auction-based groups with transparent procedures.
2. Online Chit Funds
As technology evolves, chit fund companies like KDC Chits offer digital platforms for easy participation. Members can join, bid, and track their chit group activities from the comfort of their home. Online chit funds make saving and borrowing even more convenient.
3. Government-Regulated Chit Funds
These chit funds are registered under the Chit Funds Act, 1982, and are monitored by regulatory authorities. KDC Chits adheres to all applicable legal guidelines, ensuring full transparency, secure operations, and confidence in subscribers.
4. Fixed Chits (Non-Auction Chits)
Fixed Chits are a non-auction variant where subscribers contribute a fixed amount on a daily, weekly, or monthly basis. Unlike traditional chits, there is no bidding involved. At the end of the term, the member receives a pre-decided payout amount, which is typically more than the total investment.
This model is perfect for those looking for guaranteed returns and a predictable schedule.
With KDC Chits, fixed chit plans offer:
- Assured returns
- Transparent receivable and payable schedules
- Ideal for low-risk savers
- Flexible contribution frequency
- Hassle-free saving and payout process
Why Choose KDC Chits?
If you’re still wondering how many types of chit funds there are, it’s clear that the right type depends on your financial goals. Whether you’re interested in auction-based plans or fixed chits, KDC Chits provides a legally compliant, transparent, and efficient chit fund experience. Our long-standing reputation and customer-first approach make us one of the most trusted chit fund companies in Kerala.
Learn more or join a plan today at KDC Chits.
For more details on how to manage your finances and explore the best financial options available in India, visit MoneyControl: Personal Finance.