Chit Fund.[ Same word in any Language.Rs.22,000 Crore Scam in West Bangal.]
Money Lenders or Swindlers.
It works if you do it with the right person.
Any person who does not know how to read and write English or Hindi cannot go to a bank to deposit his savings for any planned expenditure or money required for emergency. This gave birth to what was then called Chitty . It was all started many decades ago when our literates were all mainly English speaking people and every bank in the country was private except the banks controlled by the private rulers of the state who ran their state.These banks were called as state banks by each state and so they were all govt banks even as the govt was private.The one thing that was common in any bank was the language used for banking transactions which was only in English.When those persons who could not do banking as they were ignorant of the language they trusted some person whom they know as a trustworthy man and requested him to keep their savings with him so that it would accumulate and could be withdrawn at any time of the day with out any problem.The person with whom the money is deposited would give a Chit ( A small piece of paper on which the number is written which would be just a numerical number only indicating the amount )on the next deposit a new chit would be given and the old destroyed.The person would carry this Chit as if it was a check on his money deposited.He would keep it safe like it was cash.Over a period of time it became a sort of pride to show the chit to his friend to show he had money.He could even take a loan on it.This was a secret deposit also as no one could make out from a number as to it what was.In case it was noticed.This practice was confined to lady's in the beginning.Soon it spread like a wild fire and even few business people dealing with house hold article and cloth especially sarees started it saying deposit so much money per month and take home any item of your choice worth your deposit plus as bonus some thing extra.This type of marketing spread to every item on the shelf of every shop including gold.Chit Fund Company's started.Banking business was affected and by this time major banks were nationalized all state banks included and Reserve Bank was created to control all nationalized banks.The Banking Industry came to know the parallel banking that had started and they complained to the Reserve Bank.The Chit Fund Co's knew the trade of give and take so they managed to get permission from Reserve Bank itself to run their business.Billions of Rupees were thus taken away from public by private parties.No one asked any question and thus it grow from scratch to sky high.Scams and swindling went on but the Chit fund kept growing.It is still in practice in public and private.Modes operand i depends from place to place in any shape and form.It has its strength with equal weakness but there is no control.
The only way to stop this is not to stop it.
